Everyone in healthcare has been aware for years that there is a shortage of nurses. But now Cheryl Peterson, senior policy fellow, American Nursing Association, calls the current situation "The Perfect Storm."

"Nurses are getting older," she begins, their average age reported to be between 43 and 46. "Those nurses are beginning to retire and there are not enough senior nurses left to continue teaching. At the same time, funding for nursing education is being cut just as millions of baby boomers are starting to utilize medical facilities."

The American Association of Colleges of Nursing (AACN) recently took the temperature of the nursing shortage indicators and the numbers, from varying sources, are staggering:

· According to the February 2007 Health Affairs, the shortage of registered nurses will increase to 340,000 by 2020, three times the current rate.

· They also report that 55 percent of nurses surveyed by Nursing Management intend to retire between 2011 and 2020. The majority of them are highly trained nurse managers.

· All 50 states will experience a shortage to varying degrees by 2015.

· U.S. hospitals already need approximately 118,000 RNs to fill vacant posts nationwide, according to the American Hospital Association, with 49 percent of hospital CEOs noting "more difficulty in recruiting nurses."

· According to the latest projections from the U.S. Bureau of Labor Statistics, more than 1.2 million new and replacement nurses will be needed by 2014. Government analysts project over 700,000 new RN positions will be created through 2014, but that will still leave nearly a quarter of the positions needed unfilled. Worth Noting: the average age of Baby Boomers will be 68.

"It's quite an unmanageable problem," Peterson says, adding, "It's been going on for years, resulting in a decline in ANA enrollment and a decline in nursing school applications, along with a deterioration of the work environment."

"The RN shortage is worldwide," says Lewis Freeman, a RN case manager at NYU Hospital for Joint Diseases. "Nursing is still considered a 'hot' profession'," he insists, "with many new opportunities for nurses opening in Homecare." But that's a high-tech job requiring IV infusions, chemo and wound care. New positions, such as Nurse Practitioners, also have been created, allowing nurses with advanced degrees to write prescriptions, among other "advanced" duties.

Europe is short of nurses, Freeman adds, and developing countries are actively seeking foreign RNs, especially from English-speaking countries. And those nurses from the Philippines, India and Africa that come to the U.S. are creating shortages in their own home countries.

Reasons for Shortage are Complicated and Longstanding

"The reasons are complicated," Freeman explains, beginning with decisions made in the 1950s to downgrade nursing schools and create "associate" degree programs available at local two-year community colleges. Nursing education was no longer hospital-based with a Bachelor of Science in Nursing (BSN) no longer mandatory.

"All those (hospital) programs were closed," Freeman says. "Nurses with four-year degrees felt they were no longer treated as professionals. Of course, those two-year nurse associates earned less. Today, we are paying for being so short-sighted."

A nursing shortage is a lot like the weather: everybody talks about it, but nobody seems to know what to do about it. The ANA's own in-house magazine, in March of 1998, ran a detailed article titled: New Nursing Shortage Hits: Causes Complex. Any alarms raised about quality care clashed with the shortage of cash, however. That same year, the ANA noted that California, for example, in 1998, waived nurses licensing requirements during its flu epidemic." Then Governor Pete Wilson called it an "emergency care crisis."

"After the failure of the Clinton Health Care plan in 1993," Peterson notes, "managed care was thought to be a solution - and it wasn't."

As Chaos Builds, Nursing Professions Try to Respond

"By 2000, it was a fairly chaotic time," Peterson says, and it was time for the ANA to respond. In 2001, the ANA joined with other autonomous nursing organizations such as the AACN, AONE, and NLN, in issuing a joint report: Strategies to Reverse the New Nursing Shortage, which focused on leadership for education, practice and research.

"We invested more heavily in nursing education by creating scholarships," Peterson noted. "And we shifted our focus towards creating new teachers of nurses as nursing faculty got older."

The nursing professions initiative has had success. "We now have a wait list of about 100,000 people who want to train as nurses. The problem is we don't have the faculty."

Indeed, by 2004, many men and women decided to choose nursing as a new or second career. Health Affairs Journal reports that larger numbers of people in their late twenties and early thirties are entering the profession, far older and from different segments of the potential workforce than in the past.

Recruiting Success Clashes with Statehouse Cutbacks

At the same time, however, cash-strapped state governments began cutting back on college funding as they faced their own budget short-falls.

"We have the students but lack the capacity - the brick and mortar buildings and the labs do not stretch far enough," she says.

"A major problem," adds Lewis Freeman, "is the low pay for nursing teachers.

RNs start at around $50 to $60K a year, and despite 12-hour shifts, usually work three or four days week. "It's hard for colleges to compete with that (kind of pay scale)," Freeman explains, adding, "Colleges need to expand and offer more competitive salaries for its nursing faculty."

Megan Palmer, a highly-regarded intensive care nurse at NYU Medical, is a classic example of both the shortage and teaching issues.

Palmer is a "floating nurse." She lives in Ohio, but three months of the year, NYU pays her to move to New York and "fill in." On top of her salary, Palmer has her room and board and travel expenses covered. While her three-day weeks are often 12 to 15 hour shifts, it still allows her to perform at night in New York City bands.

Despite all those perks, however, Palmer says she really would love to teach nursing and does, back in Ohio. But the pay scale is miserable.

"I don't mind the long hours and the difficulty of the work," she says. "You know going in that is part of the job. It's the lack of money." According to Palmer, she still needs additional part time work to meet expenses.

Worse still, she could leave all together.

Poor Working Conditions Contribute to the Exodus

"The current work environment is not greatly sympathetic to keeping nurses," Peterson says. "We have staffing problems, fueled by wages and working conditions that are not conducive (to nurse retention). Nurses are looking elsewhere for work and are finding it in surgery centers, out patient care, and home care. Hospitals just haven't competed well, demanding weekends, holidays, and nighttime hours, which those other sources of employment do not."

Extra duties required by the HMOs have cost hospitals plenty. According to Freeman, who works as an RN case manager, "My job is to communicate with the HMOs in order for a hospital to get reimbursed. The HMOS used to send their own RNs to do that. No more. Case Management Overtime is costing hospitals billions of dollars."

One State College Answers the Nursing Education Shortfall

The Rhode Island College School of Nursing prides itself as rising to the task, despite all the obstacles. A state college that focuses primarily on teaching, in 1970, RIC created a separate department of nursing. Forty students applied. By 1999, that number grew to 156.

RIC achieved those numbers by making the program tougher. Funds were found to create a separate School of Nursing offering a BSN. Currently, over 400 students are enrolled, an enormous increase. Over 30 nursing faculty are on campus as full or assistant professors. A new masters program (MSN) is now available and the nursing college boasts a 95 percent pass rate for its students gaining nursing accreditation.

"That's way above the national average," explains Jane Williams, Dean, "Our students are getting prime jobs because we took the time to grow and earned an impressive reputation."

Being a School of Nursing gives the RIC program "status we deserve," but, Williams notes, "we also put a lot of effort into academics tutoring and student retention. Nearly 75 percent of our students also have family and jobs. Yet 75 percent of our incoming freshmen graduate." That's an impressive number, given its demographics, but RIC is shooting for 80 percent or more.

Financial aid is key. Rhode Island College's School of Nursing has over 30 separate scholarships and awards offering money for students pursuing specific areas of care, such as long-term care, health care, or oncology. Other awards aim for specific groups: such as the National Association of Hispanic Nurses Scholarship and the Minority Nurse Scholarship.

Dean Williams makes the case for college-trained nurses succinctly: "Records show that the patient mortality rate is highest among hospitals that have a low percentage of nurses with advanced degrees," she notes.

According to Williams, certain specialties in nursing are particularly sought after by hospitals and other health care providers: pediatrics, gerontology, public health and acute care. Rhode Island College School of Nursing now has new Masters Degree programs in the last two. But it, too, fights the lack of trained faculty.

"Currently, we are fully staffed," Dean Williams notes, "but as that faculty retires, we will have a real problem."

Partnerships Building Crucial

RIC works with area hospitals to recruit, train and staff its faculty, including a new partnership with the local Veterans Memorial Hospital in Providence.

"We are working with the VA to hire a clinical nursing educator who will also train our students," Williams says, noting, "This is a relatively new development. In the past, hospitals, now removed from nursing training, had their own managed care issues to deal with."

"In the past, everyone devalued the education of nurses," Williams says. "Meanwhile, hospitals and other agencies stopped hiring clinical specialists and other masters-prepared nurses, saving money by hiring the worst-prepared nurses."

Moreover, women, who made up the majority of nurses through the 1970s, had other choices. "Women went into law, into business," Dean Williams adds. Now, both men and women are returning to nursing as a first or second career.

"We have an advisory board of doctors, lawyers and current nurses who are working with us to evaluate our future plans and to fund raise," Williams notes.

"Fund Raise" is key. While the State of Rhode Island increased RIC's funding support lately, allowing the School of Nursing to add three new faculty positions this year and for the next three years, the State Budget is in crisis.

"We need more classrooms and more labs," Williams says. While the State Legislature is cutting back, other state capitals such as Maryland's "are putting in millions."

State Governments and State Universities Also Respond

Indeed, state and hospital joint efforts to address the nursing shortage have created some significant responses, according to the AACN data:

· Tennessee and state health officials in 2007 launched a campaign to raise $1.4 million in scholarships for RNs to receive advanced degrees needed to teach nursing. In Illinois, the governor, in 2005, created the Illinois Center for Nursing which is responsible for assessing the current supply and demand for nurses in Illinois and developing a strategic plan for the state to educate, recruit and train nurses.

· Nursing colleges and universities are also forming strategic partnerships, much as Rhode Island College has done with the VA, and seeking private support to help expand student capacity. For example, Blue Cross and Blue Shield of Florida donated $600,000 in funding to both the University of North Florida and the University of Florida to address nursing education. The State of Florida matched each gift with $420,000 of its own.

· In 2005, US Representatives from NY and California introduced the Nurse Education and Expansion and Development (Need) Act. The legislation (H.R. 3569) calls for capitation grants for schools to hire and retain current faculty, helping schools of nursing increasing student conversions, purchasing educational equipment, enhancing audiovisual and clinical laboratories, and expanding infrastructure. Senators Bingaman (D-NM) and Cornyn (R-TX) also introduced the Nurse Faculty Education Act (S 1575) to increase the number of doctorally-prepared nurses serving as faculty.

· In 2005, the U.S. Department of Labor awarded more than $12 million in grant-funding through the High Growth Job Training Initiative, $3 million of which will help address the nurse faculty shortage. A later round of funding has now brought the DOL commitment to more than $43 million.

All the money and effort needed to combat the nursing shortage always translates, of course, into what are really life-and-death issues. Next time you are in a cardiac care unit, or a pediatric cancer center, or kiss your elderly parents good-bye at an assisted living facility, remember the old saying: "You get what you pay for."

This story originally appeared in the April 2008 issue of DOTmed Business News.