Workforce Compensation Plan

Novemeber 4, 2021

TO:All Faculty, Staff and Students

FROM:Dr. LouAnn Woodward, Vice Chancellor for Health Affairs

SUBJECT: Workforce Compensation Plan

The last two years have been the toughest I have experienced in my career in medicine.  Stress and strain at previously unimaginable levels have been placed on everyone who works in health care.  But even in the face of this, you stepped up in so many ways.  Your devotion to our missions – our students, the advancement of science, and especially our patients - has been, and continues to be, inspiring.

Right now, patient demand for our services is very high.  We have returned to and even exceed pre-pandemic patient volumes.   I am relieved to report that this, along with strong operational management, has resulted in us closing the first quarter of this fiscal year ahead of budget.  This good news is a result of everyone’s hard work.  The improving situation on the COVID front is also good news. 

However, in all areas of health care, including here, across the state and nation, the situation around staffing and workforce is dire.  We have lost staff – including nurses and respiratory therapists – due to a number of reasons over the course of the pandemic.  Some of the factors that have led to our staffing shortage include:

• Individuals who were near retirement who decided to go ahead and retire,
• Nurses and others who decided to stop working in health care altogether,
• A number of staff decided to take positions with travel agencies,
• A small number left as a result of our vaccination policy
• And others who left to work for other hospitals or clinics in the area. 

The factors are not unique to us, they are local and national trends. But knowing we are not in this predicament alone doesn’t make our current reality any less painful.  In order to maintain the current staff-to-patient ratios we are committed to, we have had to begin restricting hours in some critical patient care areas and decreasing the number of available staffed beds in our hospitals.

Closing beds and reducing hours for patient care units and procedural areas will have a negative impact on access to care and a negative financial impact for the organization. We feel it is imperative to continue our commitment to the safest and best possible patient care and to invest in our workforce for both our short- and long-term success. I have said many times that our most valuable resource is you – the staff and faculty who make this engine run.  Those of you who are committed to our missions make UMMC the very special place it is.   In the last 24 months, we have made staff compensation investments to base pay (market adjustments, hiring scale) for non-exempt employees of approximately $19 million as well as $34 million in premium pay, including overtime.  While we have made significant investments in our workforce during these challenging times, more is needed.

To that end, I’d like to share with you a multi-faceted plan to further invest in our workforce.  This plan includes a number of elements with effective dates that range between now and early 2022.

The elements of the plan include:

1. Revision of our pay scale for nurses.  This is the most critical element of the plan and the most complex.  Our current method for determining nurse compensation is complicated and challenging to understand.  While there have been long-standing differentials for working weekends and nights, for experience, for certifications, etc.,  the current problems with vacancies have created a need for add-ons of a variety of types.  The Medical Center has engaged with a national firm that will assist us in in re-designing the nursing compensation structure so that base rate is increased and more in line with a rapidly changing market. The goal is a simpler and more transparent structure.  As staffing numbers improve, we also plan to offer flexible scheduling options we don’t currently have. The target for rollout of the pay scale revision is between December 2021 and February 2022.
2. Develop the ongoing process whereby current UMMC inpatient RNs and respiratory therapists may be hired by our preferred staffing partner, Healthier Mississippi People (HMP), if they desire to do so. This will allow current staff to have a variety of salary and benefit options that they presently don’t have. HMP is able to offer its employees some benefits and compensation options that UMMC cannot which can yield higher take-home pay. UMMC employees that want this structure as compared to UMMC’s higher levels of employer-paid benefits are encouraged to sign-up for one of the information sessions that will be offered beginning Monday, Nov. 15, 2021. Multiple dates and times are available and these sessions will also be offered on an on-going basis prior to the expected implementation in February 2022. Click here to request more information.
3. Full-tuition scholarships will be available to students in the incoming UMMC Jackson January 2022 accelerated nursing class.  A three-year commitment to work at UMMC following graduation is required to be eligible for this scholarship.
4. Workforce-enhancement scholarships are available to the UMMC Jackson December 2021 accelerated nursing graduates who accept and fill a full-time-employment position at UMMC starting in January 2022.
5. Except for HMP, our preferred staffing partner, we will decrease our dependence on external-staffing solutions in order to continue to develop a workforce with a long-term commitment to the Medical Center. 
6. In a new change to our practice, the option is now available for registered nurses at UMMC who are currently not working in one of our hospitals to obtain a secondary RN position within a UMMC hospital.
7. On November 28, 2021, we will move forward with the planned base pay adjustments of clinical staff whose compensation is on an experience-based hiring scale. These adjustments will impact approximately 2,500 clinical staff. Additionally, the nurse hiring-scale ladder will be expanded beyond the current limit of 20 years of experience, which will impact approximately 300 clinical staff. Managers will receive the details of this initiative and further instructions from Human Resources on Nov. 17, 2021.
8. On November 28, and based on the overall Medical Center’s positive financial results for the first quarter of this fiscal year, we will move forward with select market adjustments for non-hiring scale staff.  We are constantly monitoring employee compensation relative to market data, most recently in a comprehensive market study that concluded in March 2021. We intend to implement recommendations developed from this study which will affect a significant number of employees who are in the jobs that were found to be furthest out of market. Because FY22 budgets are set and well underway, these market adjustments will be centrally funded. It is estimated that approximately 2,300 employees will be impacted.
9. For entry-level, full-time positions, the starting minimum wage will be increased to $13.00 per hour which will impact about 700 employees. Managers will receive information on this change from Human Resources on Nov. 17, 2021.
10. Effective January 1, 2022, a new performance-based incentive compensation program will give managers the ability to provide modest pay increases for documented high performers and modest pay reductions for documented low performers.  These changes will be budget neutral. More information about this will be shared at a later date.

On top of the steps and actions I have already laid out, we commit to maintaining a strong financial picture for the Medical Center so that performance-based and market-driven compensation actions will be regular and budgeted items.

The multi-faceted plan I described above has been developed with the input of many leaders. I am very appreciative to all who have participated.  A task force consisting of Britt Crewse, Dr. Guy Giesecke, Dodie McElmurray, Jason Zimmerman, Molly Brasfield, Dr. Jonathan Wilson, Dr. Alan Jones, Dr. Brian Rutledge, Dr. George Russell, and myself developed the working components of the plan.

You will note, in addition to my signature on this memo, there are signatures of other members of the Executive Leadership team.  Their signatures signify support for these actions.

We realize we may see a negative financial impact as a result of reduction of available staffed beds and reduced hours of operation in some areas of our clinical enterprise.  DESPITE that, we have decided to take the calculated risk and move forward with this investment.  In addition, we commit to you that we will not engage in reductions in force or layoffs this spring as a solution to rectify any negative budget variance that may occur due to limitations of clinical services as a result of our staffing shortages.  We fully realize, as an organization, we may have to weather a rough patch for the short-term in order to move the organization forward toward a brighter and stronger future. But I am confident that all of us, together, can do this.  After all, we are #UMMCStrong.

Thank you.