Office of the Public Auditor CNMI
1 The three manpower agencies had provided 124 nurses to the CHC as of September 30, 2002.
EXECUTIVE SUMMARYHiring of Nurses Directly by the Commonwealth Health Center Versus Contracting Through Manpower Agencies Report No. AR-03-06, dated August 19, 2003
Summary This report presents the Office of the Public Auditor’s (OPA) evaluation of nurses provided to the Departmentof Public Health’s Commonwealth Health Center (CHC). The evaluation’s objective was to determine whetherCHC’s practice of using manpower agencies to hire nurses saves the Department of Public Health and theCommonwealth of the Northern Mariana Islands (CNMI) money without compromising patient care. As ofDecember 31, 2002, three manpower agencies had provided CHC with 126 of its 209 nurses and CHC haddirectly hired the remaining 83 nurses. OPA found that the hiring of nurses through manpower agencies is less costly than the direct hiring of nurses.However, continuing the current practice of contracting with manpower agencies rather than directly hiringnurses will perpetuate other problems, most notably the difficulty in retaining qualified nurses. More specifically:
• if CHC were to convert the 124 nurses1 provided by manpower agencies to direct hire status, it wouldincur an additional estimated $1.5 million annually, or about 37 percent more than it is currently payingmanpower agencies.However, assuming that most non-resident direct hires would elect not to be a partof the CNMI’s retirement system, the CNMI could substantially reduce this additional cost to about $.7million by converting all CHC nurses on board to direct hire without retirement benefits. As retirementfund membership is currently mandatory, the CNMI would need to amend legislation to make retirementfund membership optional.
• if CHC were to directly hire National Council Licensure Examination (NCLEX) licensed nurses withfive or more years of experience (those at the top of the pay scale), CHC would incur an additionalestimated $2.6 million annually, or about 64 percent, more than it is now paying manpower agencies.Likewise, assuming that most non-resident direct hires would elect not to be a part of the CNMI’s retirementsystem, it could substantially reduce this additional cost to about $1.6 million by converting all CHC nurseson board to direct hire without retirement benefits, again provided legislation was amended to makeretirement fund membership optional.
Analysis
Assuming Direct
Conversionof Current Manpower
Nurses
Assuming CHC Hires Nurses with at Least an NCLEX and 5 Years of Experience
in Lieu of Current Manpower Nurses
Cost of Direct Hiring $5,587,311 $6,693,472
Less: Cost of Current Manpower Contracts 4,075,300 4,075,300
Additional Annual Cost to Fund Direct Hires $1,512,011 $2,618,172
Percentage Increase in Current Costs 37% 64%
Less: Employer’s Retirement Contribution Required Under Law
801,757 1,009,457
Adjusted Annual Cost Increase UnderDirect Hiring Net of Retirement Contribution
$710,254 $1,608,715
Office of the Public Auditor CNMI
A copy of this report is available at the Office of the Public Auditor
Michael S. Sablan P.O. Box 501399Public Auditor Saipan, MP 96950Commonwealth of the Northern Mariana Islands Tel. No. (670) 322-6481Web Site: www.opacnmi.com Fax No. (670) 322-7812
Adjusted Percent Increase in Direct Hiring Cost Without Required Employer’s Retirement Contribution
17% 39%
Manpower agencies offer lower salaries and benefits than nurses hired directly by CHC receive, resulting ingreater nurse turnover among manpower nurses ,which, according to four of six of CHC doctors interviewed,has adversely impacted patient care. OPA found that direct hire nurses stay in the CNMI for a considerably longerperiod than do manpower nurses, resulting in less turnover. The average length of employment of direct hirenurses employed by CHC was 108 months while manpower nurses average only 28 months. CHC is constantlybeing forced to rebuild its nursing staff with inexperienced manpower nurses who arrive to replace those leaving.Most manpower provided nurses use their CNMI job as a stepping stone to the United States (U.S.) and othercountries. Data obtained indicates that once nurses obtain the NCLEX certification needed to practice in theU.S., most seek jobs elsewhere because their current salaries are not competitive with compensation they canobtain elsewhere.
OPA found that many manpower provided nurses would likely stay at CHC if they were paid pay and benefitscomparable to direct hire nurses; likewise many former manpower nurses, now in the U.S., would possibly returnto the CNMI. More specifically, over 90 percent of the manpower nurses interviewed stated that they wouldremain at CHC if they were converted to direct hire status with appropriate salary increases and a benefits packagesimilar to that provided to direct hires.
While there are no easy answers, it appears that the direct hiring of non-resident nurses would allow CHC toretain nurses and thereby help improve patient care. Although the CNMI continues to face a fiscal crisis, it cannotafford to let the health care system deteriorate. In the end, nursing experience and continuity in service, andtheir impact on patient care, cannot be discounted when analyzing the costs of conversion. However, becausethe present environment of financial austerity cannot be ignored, one solution may be to convert back to directhire of nurses over a period of time.
The Acting Secretary of Public Health had no comments on this report other than to state that this issue wasof great importance to the department and the community as a whole.
Two of the three manpower agencies, however, provided comments. One agency advised that the Departmentof Public Health needed to find a compromise solution to resolve disparities and inequities at hand. It contendedthat CHC would have difficulty in retaining qualified nurses even if it hired them directly and if they were equallycompensated. The other agency stated that more than a small pay increase was needed if CHC wanted to hireand retain qualified nurses. Further, the agency stated that CHC could improve its patient care if it improvedits communication and relations with manpower companies.
Office of the Public AuditorCommonwealth of the Northern Mariana Islands
Audit ReportAR-03-06
Department of Public HealthHiring of Nurses Directly by the Commonwealth HealthCenter Versus Contracting Through Manpower Agencies
1 CHC is the Commonwealth of the Northern Mariana Islands’ primary health facility under theDepartment of Public Health. In this report, OPA refers to CHC as the contracting entity for nurses, althoughtechnically the Department of Public Health contracts for nurses.
Office of the Public AuditorCommonwealth of the Northern Mariana Islands
World Wide Web Site: http://opacnmi.com1236 Yap Drive
Capitol Hill, Saipan, MP 96950
Mailing Address:P.O. Box 501399Saipan, MP 96950
E-mail Address:[email protected]
Phone: (670) 322-6481Fax: (670) 322-7812
August 19, 2003
Dr. James U. HofschneiderSecretary of Public HealthP.O. Box 500409 CKSaipan, MP 96950
Dear Dr. Hofschneider:
Subject: Hiring of Nurses Directly by the Commonwealth Health CenterVersus Contracting Through Manpower Agencies (Report No.AR-03-06)
On August 19, 2002, you requested the Office of the Public Auditor (OPA) to determine whetherthe Commonwealth Health Center’s (CHC)1 practice of contracting with manpower agencies fornurses saves the Department of Public Health (DPH) and the Commonwealth of the NorthernMariana Islands (CNMI) money without compromising patient care. For the last eight years suchagencies have provided CHC with a large portion of its nursing staff.
BACKGROUND
In 1995, the Department of Public Health entered into contracts with four manpower agenciesto provide a portion of CHC’s nursing staff. Such contracts were considered necessary due to theanticipated departure of non-U.S. citizen nurses dictated by Public Law 7-45. The sunsetprovision in Public Law 7-45 allowing DPH and other agencies to employ non-resident workerswas due to expire on September 30, 1995.
DPH has contracts with three agencies to provide nurses for CHC: Paras Enterprises (Paras),Saipan Employment Agency Services Inc., (SEAS), and Marianas Health Services (MHS). As ofDecember 31, 2002, these three agencies were providing CHC with 126 nurses as follows: Paras -59, SEAS - 63, and MHS - 4. At that time, CHC had 83 other nurses on board that it had hireddirectly.
2 The National Council Licensure Examination (NCLEX), developed by the National Council of StateBoards of Nursing, is a national nurse licensure examination required in the United States and its territories forlicensure. This examination, although offered in the CNMI, is not a requirement for licensure in the CNMI.
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OBJECTIVE, SCOPE AND METHODOLOGY
The objective of OPA’s review was to determine whether CHC’s practice of using manpoweragencies to hire nurses saves the DPH and the CNMI money without compromising patient care.To determine the least costly source of nurses, we conducted cost analyses using both manpowercontract and direct hire data.
In our analyses we annualized all computations and estimates and relied on, as necessary, previouscost analyses. We interviewed DPH officials, manpower agency personnel and officials, as well asCHC doctors, unit managers, nurses and other CNMI officials as to the impact, if any, on patientcare resulting from the use of manpower-provided nurses. We reviewed and compared retentionrates for manpower agency nurses and direct hire nurses in the same or similar positions. Weobtained data from doctors and unit managers indicating the training that CHC needed to provideto manpower versus direct hire nurses. We examined the effect of nurses passing the NationalCouncil Licensure Examination2 (NCLEX) and CHC’s ability to retain these certified nurses.Finally, we compared the quality of nursing staff being provided by manpower agencies with thatof CHC direct-hire nurses by reviewing: (1) the type of nursing degree obtained, (2) years ofnursing service, and (3) credentials received (such as NCLEX or other certificates).
We conducted our review at DPH’s office in Saipan from August to December 2002. This reviewwas performed, where applicable, in accordance with Government Auditing Standards issued bythe Comptroller General of the United States. Accordingly, we included such tests of records andother auditing procedures as were considered necessary in the circumstances. Due to the limitedscope of our review, we did not evaluate any other internal controls.
3 As per a list provided by CHC’s Nursing Services Section.
4 In July 2002, DPH published a request for proposal (RFP02-CHC-0092) to extend the services ofmanpower agencies beyond September 30, 2002. These manpower service contracts were subsequently extended.
5 This does not consider taking in new applicants who have NCLEX certification and additional years ofexperience.
6 Base contract cost means the basic rate the manpower agency charge for each category of nurses, anddoes not include any additional cost that may be charged such as overtime pay.
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RESULTS OF REVIEW
OPA found that the hiring of nurses through manpower agencies is less expensive than the directhiring of nurses. However, continuing the current practice of contracting with manpoweragencies, rather than directly hiring nurses, will perpetuate other problems, most notably thedifficulty in retaining qualified nurses. Manpower provided nurses do not receive pay and fringebenefits (i.e. retirement benefits, housing, night differential, holiday pay, sick leave, annual leave,and health insurance) equal to their direct hire counterparts. In the end, the higher turnoveramong manpower provided nurses and their resulting replacement with less experienced nursespotentially adversely affects the quality of patient care provided.
Direct Hiring of Nurses Will Result in Greater Costs
According to CHC,3 124 manpower nurse positions in DPH contracts with manpower agenciesscheduled to end on September 30, 20024 could ultimately be replaced by direct hire nurses. Weconducted two analyses, one which assumed conversion of all current manpower nurses to directhire, and another which assumed that CHC would only hire NCLEX licensed nurses with at leastfive years of experience. OPA found that:
• if CHC were to convert the 124 nurses provided by manpower agencies to direct hirestatus, it would incur an additional $1,512,011 annually over what it is currently payingmanpower agencies5. This represents about 37 percent more than the contract amount6.See Appendix A for low-end analysis.
• if CHC were to directly hire NCLEX licensed nurses having five or more years ofexperience (those considered at the top of the pay scale), CHC would incur an additional$2,618,172 annually, or about 64 percent, more than the base contract cost it is now payingmanpower agencies. See Appendix B for high-end analysis.
The additional costs associated with direct hiring of nurses are due largely to personnel benefits,many of which manpower agencies do not provide. Under the low-end analysis, total annualpersonnel benefits amount to 43 percent of total costs whereas under the high-end analysis theyamount to 40 percent of such costs. See Appendices A and B for total annual total personnelbenefit costs under both analyses.
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Assuming that most non-resident direct hire nurses would elect not to be a part of the CNMI’sretirement system, the CNMI could substantially reduce the additional costs associated with directhiring by making CNMI retirement participation optional for prospective non-resident direct hirenurses. If the non-resident direct hire nurses elected not to participate, the estimated additionalcosts would be:
• $710,254, assuming conversion of all CHC nurses on board to direct hire (see AppendixC for low-end analysis), or
• $1,608,715, assuming that CHC hired only NCLEX licensed nurses having at least fiveyears of experience. (See Appendix D for high-end analysis.)
As participation is currently mandatory, the CNMI would need to amend the law to make CNMIRetirement Fund membership optional for the nurses.
A comparison of the additional costs associated with direct hiring under each of OPA’s twoassumptions, namely the direct conversion of the current manpower nurses and hiring only nurseshaving a NCLEX certification and 5 years of experience follows:
Analysis
Assuming Direct
Conversion ofCurrent
Manpower Nurses
Assuming CHC Hires Nurses with at Least an NCLEX and 5 Years of Experience
in Lieu of Current Manpower Nurses
Cost of Direct Hiring $5,587,311 $6,693,472
Less: Cost of Current Manpower Contracts 4,075,300 4,075,300
Additional Annual Cost to Fund Direct Hires $1,512,011 $2,618,172
Percentage Increase in Current Costs 37% 64%
Less: Employer’s Retirement Contribution Required Under Law
801,757 1,009,457
Adjusted Annual Cost Increase UnderDirect Hiring--Net of Retirement Contribution
$710,254 $1,608,715
Adjusted Percent Increase in Direct Hiring Cost WithoutRequired Employer’s Retirement Contribution
17% 39%
OPA’s analyses above do not factor in the additional cost of overtime that manpower agencyprovided nurses receive as OPA was unable to determine whether such overtime resulted fromany periodic shortage of nurses or from the need to cover nurses on annual and sick leave, medicalemergencies, holidays, or training.
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OPA assumed that more experienced direct hire nurses would cost more, but that they would alsoincrease the quality of patient care for patients presented for treatment. OPA further assumed thatthe staff turnover rate for nurses provided by the manpower agencies would decrease if the nurseswere direct hires, thereby reducing the training necessary for new nurses. Finally, OPA assumedthat greater continuity of nurses associated with prolonged nurse employment would also increasethe quality of patient care.
The limited scope of this review did not allow OPA to ascertain the related costs of training newnurses. In addition, OPA did not analyze whether more experienced nurses, with longevity atCHC, might enable CHC to provide improved patient care with less individuals on its nursingstaff.
Manpower Nurses May Negatively Affect the Quality of Patient Care at CHC
1. CHC Faces Difficulty in Attracting and Retaining Qualified Nurses
CHC has had difficulty in attracting and retaining trained and qualified nurses. Much of CHC’shiring of nurses is done by manpower agencies rather than directly by CHC. These agencies offerlower salaries and benefits to nurses than CHC provides to nurses hired directly. Based oninformation obtained, it appears that CHC retains a relatively low percentage of the manpoweragency provided nurses because most manpower nurses use their CNMI employment as a meansof moving to the United States (U.S.) and elsewhere. Data obtained also indicates that once nursesobtain the NCLEX certification needed to practice in the U.S., most seek jobs outside of theCNMI because their current salaries are not competitive with compensation they can obtainelsewhere.
OPA found that direct hire nurses stay in the CNMI for a considerably longer period than domanpower nurses, resulting in less turnover. As of December 31, 2002, CHC employed 209nurses, namely 126 manpower hire nurses and 83 direct hire nurses. The direct hire nurses hadbeen employed by CHC for an average of 108 months, or approximately 9 years, while themanpower nurses averaged only 28 months, or just over two years. Turnover among manpowernurses is much higher than among direct hire nurses.
The two largest providers of manpower nurses, Paras and SEAS, have retained a very lowpercentage of NCLEX certified nurses.
• Most Paras agency nurses who have passed the NCLEX have left the CNMI after a two-year stay in the CNMI. To illustrate as of December 31, 2002, 37 of the 145 nurses thatParas provided had previously passed the NCLEX before being hired.
• However, of the 37, 23 resigned within two years of being detailed at CHC andonly 14 remain at CHC.
• An additional 46 passed the NCLEX after being hired, 35 of which resigned after
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less than two years at CHC, leaving only 11 at CHC.
• Thus, of 83 Paras nurses who had passed the NCLEX , 58 nurses or about 70percent left after an average two-year stay, and only 25 nurses or about 30 percentopted to stay longer.
• Likewise, most SEAS nurses who passed the NCLEX left after a two-year stay. SEAS hadprovided 146 nurses to the CHC as of December 31, 2002, 27 of whom had passed theNCLEX prior to being hired. However, 20 of the 27 left after working an average of a yearand a half. An additional 23 nurses hired by SEAS passed the NCLEX after being detailedto CHC, but only 7 remained after a year and a half. Thus, of 50 nurses who passed theNCLEX, 36 nurses, or about 72 percent, left after less than 2 years.
• Of the remaining 122 manpower nurses (59 Paras nurses and 63 SEAS nurses) stillemployed at CHC, only 39 nurses, or about 32 percent, had passed the NCLEX.
According to seven of eight unit managers and five of six doctors interviewed, CHC expendsconsiderable resources in training a nurse, particularly manpower provided nurses most of whomcome from the Philippines. According to three of eight unit managers and all doctors interviewed,most nurses recruited by the manpower agencies lack independence, assertiveness, and experience.As such, they believe that those nurses need additional training not normally required of U.S.trained nurses. Five of six doctors and seven of eight unit managers advised us that while basicorientation for new nurse hires at CHC lasts two weeks, it may take over a year of training beforedoctors feel comfortable leaving a manpower nurse with patients.
According to most manpower nurses interviewed, many would likely stay at CHC and manyformer manpower nurses now working in the U.S. would possibly return if they were paid payand benefits comparable to direct hire nurses. More specifically, over 90 percent of the manpowernurses interviewed stated that they would remain at CHC if they were converted to direct hirestatus with appropriate salary increases and a benefits package similar to that provided to directhires. The nurses cited other reasons for remaining in the CNMI including: (1) the CNMI’s closeproximity to the Philippines, (2) the CNMI’s climate and culture, and (3) the strong Filipinocommunity in the CNMI. Also, nurses who have maintained contact with former co-workerspresently employed in the U.S. indicated that many of those nurses have expressed a willingnessto return to the CNMI if, and only if, the conversion to direct hire status was implemented.Those nurses would likely return for the same reasons that the current nurses would like to stay.Further, if those nurses did return as direct hire nurses at CHC, they would bring with them theexperience they have gained working in U.S. hospitals.
Four of the six doctors interviewed stated that the quality of nurses provided by the manpoweragencies had adversely affected patient care. For example, those nurses frequently fail to recognizecritical situations, and cannot always properly read patients’ vital signs. OPA’s review of incidentsoccurring during the eight months ending August 29, 2002 substantiates this position. OPA found42 reported incidents involving manpower nurses and 6 reported incidents involving direct hire
7 As of December 31, 2002, CHC employed 126 manpower hire nurses and 83 direct hire nurses orabout 50 percent more manpower nurses than direct hire nurses.
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nurses even though the average number of manpower nurses was about 50 percent higher7 thandirect hire nurses. • The 42 incidents involving manpower nurses ranged from communication problems to
procedural errors. The nine communication problems reported were primarily conflictsbetween patients/families and nursing staff, resulting in patient anxiety and frustration.The 33 procedural incidents reported included:
• six documentation errors and/or failure to order lab work;• one delay for an intensive care patient admitted for a possible heart attack; • eight self-inflicted needle sticks;• six medication errors;• seven patient falls, three of which were a direct result of poor judgment on the part
of the attending nurse; • two involving improperly administered medication to emergency unit patients who
were subsequently discharged without a reassessment and then collapsed whileleaving the hospital;
• a patient being fed just prior to a procedure, causing a 24 hour delay in thetreatment; and
• two miscellaneous incidents in the emergency unit; one involved a patient beingdischarged before being cleared by the doctor resulting in the patient needing to becontacted at home, requested to return, and be admitted to the hospital for cardiacproblems; and one involved a psychiatric patient who walked out of the emergencyunit unattended resulting in the need to contact the police/security in order tolocate and return the patient to the hospital.
• The six incidents involving direct hire nurses included,
• three communication problems, • one medication error, • one patient fall, and • one provision of questionable care by a midwife during infant delivery.
In addition, four of six doctors and four of eight unit nurse managers interviewed felt that in someinstances CHC had retained manpower nurses who were marginal or who had performed poorly.However, they also advised that, given the shortage of nurses and the time to train new hires, itmight be better to retain the current staff than to request manpower agencies to provide newnurses. They explained that hasty recruitment could result in less qualified replacements whowould not provide the needed performance.
Four of six doctors and three of eight unit nurse managers indicated that once the less experiencedmanpower nurses were trained, they performed at a level equal to direct hire nurses. However,
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after being trained (as indicated by the statistics above), those nurses are more likely to leave forhigher paying jobs in the U.S. Thus, instead of building a foundation of experienced high qualitynursing staff, CHC is forced to accept new entry level nurses provided by manpower agencies toreplace those who have departed.
See Appendix E for a summary of doctors and unit managers responses to the OPA interviewquestions.
2. Disparity in Compensation Between Direct Hire and Manpower Nurses
Nurses provided by manpower agencies receive a compensation package considerably lower thantheir direct hire counterparts who receive housing, annual and sick leave, holiday pay, and medicalbenefits. As such, most of the manpower nurses elect to leave CHC as soon as they pass theNCLEX, resulting in a high turnover of manpower nurses. CHC is then left with lessexperienced manpower nurses and new manpower replacements who need to be trained.
Manpower agency nurses receive an average salary of $19,298, a third less than the $27,948 theirdirect hire co-workers receive on the same work assignments. Furthermore, even thoughmanpower agency nurses have learned new skills and taken on more responsibility, they havereceived little or no pay raises during the last 7 years. In addition, some manpower nurses havebeen required to pay a recruiting fee amounting to about $1,500, the equivalent of one month’ssalary. While direct hire nurses receive night differential, manpower nurses do not.
Other fringe benefits such as housing, annual leave, sick leave, medical, and holiday pay providedto manpower nurses do not compare with the benefits their direct hire counterparts receive. Toillustrate:
• Housing is, for the most part, provided to manpower nurses in the form of two or morebedroom apartments with two nurses to a bedroom with all occupants sharing a living area,kitchen, and one bathroom. More specifically, sometimes up to 12 nurses lived in a sixbedroom apartment with two nurses to a bedroom and with all 12 sharing two bathrooms,a kitchen, and a living room.
• In other cases, the manpower nurses live in a dormitory type arrangement where each
room has an adjoining bathroom shared by the occupant in the next room. In theseinstances, a kitchen and TV room are shared by all occupants.
While the housing is tolerable, it falls short of the housing that off-island direct hire nurses canafford based on the housing allowance they receive, which is $600 per month for those withoutdependents and $800 per month for those with dependents.
In addition, while utilities are normally included as part of the housing provided to manpowernurses, 60 SEAS provided nurses advised OPA and CHC that their manpower agency hadattempted to amend their contracts to require them to pay for utilities. More specifically, SEASmanpower nurses sent a letter, dated August 13, 2002 signed by all its nurses, to the Secretary of
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Health alleging that the cost of their electrical bills was soon to be deducted from their salaries.SEAS justified changes in the proposed amendment that would transfer the burden of paying forutilities to nurses as follows: (1) employment contracts allowed for such a charge; (2) the agencyneeded to cut costs due to the economic crisis; and (3) employees had abused the use of electricity.The nurses stated in their letter that had they not signed the amended contracts, they would befaced with the possibility of not receiving their paychecks, having their employment papers puton hold until they signed the amended contracts, or a refusal to process entry permits. Althoughthe manpower nurses reluctantly signed the amended contracts, SEAS had not deducted utilitycosts from the nurses paychecks.
Manpower nurses receive four holidays a year whereas their direct hire counterparts receive 14.They receive a two-week vacation whereas direct hire nurses receive up to five weeks. Accordingto the nurses, leave is approved only after one year of service under new contracts. In addition, asmanpower agencies incur overtime costs when staff are on vacation, leave requests were frequentlynot granted.
See Appendix F for a summary manpower nurse responses to interview questions.
Other Matters - Inadequate Number of Nurses
According to the December 2002 Nursing Level Statistics prepared by the acting director ofnursing, CHC has filled 226 nurse positions and needs to fill an additional 64. As limited fundinglimits the number of nurse personnel, CHC has a nurse-to-patient ratio of one nurse to every fiveto six patients, and sometimes as many as seven patients. A national media publication has, in anumber of articles, cited studies that show the correlation between nurse staffing and patienthealth.
• A recent study in the Journal of the American Medical Association confirmed the risks topatients cared for by overburdened nurses. This study, which covered more than 200,000surgical patients and 10,000 nurses, documented the link between nurse staffing andincreased risk of patients dying after surgery, as well as with increased nurse burnout andjob dissatisfaction. The study found that when nurse caseloads exceeded four patients, therisk of a patient’s dying increases by about 7 percent for each additional patient. Morespecifically, if one nurse is caring for eight patients, the patients are 31 percent more likelyto die. In addition, each patient added to a nurse’s caseload increased the nurse’s jobdissatisfaction and the likelihood that “burnout” will push them out of nursing.
• Another recent study reportedly found that fewer nurses meant that patients suffered morefrequently from urinary tract infections, falls, and bedsores, and contracted pneumoniamore often.
• In August 2002, the Joint Commission on the Accreditation of Health Care Organizationsreportedly found that inadequate nurse staffing levels contributed to nearly one-quarterof the 1,609 cases of accidental injury or death documented for hospitalized patients since1997.
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CONCLUSION
Our review shows that, although it would be substantially more costly to replace all manpowernurses with direct hire nurses, to continue the current practice of contracting with manpoweragencies will perpetuate other problems, most notably the difficulty in retaining qualified nurses.Relatively lower pay and fringe benefits provided to manpower nurses have resulted in highturnover which has adversely impacted patient care. CHC is constantly being forced to rebuildits nursing staff with inexperienced manpower nurses who arrive to replace those leaving.
While there are no easy answers, it appears that the direct hiring of non-resident nurses wouldallow CHC to retain nurses and thereby help improve patient care. Although the CNMIcontinues to face a fiscal crisis, it cannot afford to let the health care system deteriorate. In the end,nursing experience and continuity in service, and their impact on patient care, cannot bediscounted when analyzing the costs of conversion. However, because the present environmentof financial austerity cannot be ignored, one solution may be to convert back to direct hire ofnurses over a period of time.
COMMENTS
In a letter dated July 16, 2003 (Appendix G), the Acting Secretary of Public Health indicated hehad no comments on our report other than to state that the issue covered was of great importanceto the department and the community as a whole.
Saipan Employment Agency Services, Inc. (SEAS) Comments on OPA’s Draft Report
In a letter dated July 07, 2003 (Appendix H), the President of Saipan Employment AgencyServices Inc. (SEAS) acknowledged the difficulty of retaining CHC nurses, and agreed that giventhe CNMI government’s financial situation, OPA’s suggestion for a compromise solution is a stepin the right direction. He suggested that revisions or changes in the contract terms and conditionsbetween the agencies and CHC could resolve disparities and inequities on the issue at hand andthereby meet the goals and objectives of all the parties concerned.
He contends that CHC will continue to encounter difficulty in retaining qualified nurses evenif it hires them directly. He further contends that CHC mandates the pay and benefits thatmanpower nurses receive, and an increase in such pay and benefits alone would not decrease highturnover because nurses are attracted by permanent residency status obtained in the U.S. andEurope. He said that SEAS manpower nurses would provide him no assurance they would remainin the CNMI even if equally compensated. However, he contends that most direct hire nurseswould stay in Saipan given that they are from the CNMI or Micronesia. Also, the CHC PersonnelOffice has final approval authority over manpower agency hires, and can require a manpoweragency to replace a nurse at no cost if CHC is not satisfied with the nurse hired.
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OPA Response
Although the CNMI does not offer salaries and benefits equivalent to those in the U.S. and inEurope, OPA’s analyses show that directly hiring nurses at a rate competitive with otherjurisdictions would entice more qualified nurses to remain in the CNMI. While the CNMI maybe unable to give nurses U.S. resident status, it allows those that meet the requirements of 3CMC§4437(i) and (o) to relocated immediate family members to the CNMI.
OPA disagrees with SEAS’s statement that CHC mandates the pay and benefits that manpowernurses receive. Salaries set forth in the Request for Proposal are only a guideline for prospectiveagencies, and the benefits required are those minimally required under the Non-resident Worker’sAct. While CHC has final approval over nurses hired it is, according to CHC, reluctant to dismissa nurse given the training already provided and the fear that replacements may not be adequate.
Paras Enterprises Comments on OPA’s Draft Report
In a letter dated July 08, 2003 (Appendix I), the Vice President for Operations of Paras indicatedthat OPA had not adequately demonstrated that the direct hiring of nurses would help improvepatient care. He said CHC needs to provide nurses with more than a slight pay increase if it is tohire and retain qualified nurses. Further, he contends that OPA had not addressed the hiddencosts associated with directly hiring non-resident workers, such as the recruitment fees, airfare,and NCLEX training incurred for replacement when NCLEX nurses are lured away to new jobs.In discussing high turnover, he said that while most direct hire nurses have family and culturalties in Saipan, manpower nurses lack such attachment, and many come to Saipan to take theNCLEX and then move on to the U.S. after passing the exam to obtain a higher salary and longercontracts. He believes manpower nurses could provide improved patient care if CHC would improve itsrelations with manpower companies. He stated that poor communications between the DPHadministration and manpower agencies is causing stress and fear among many manpower nurses,and that although DPH had recently initiated efforts to directly hire nurses, it has failed to provideany plan or time line for phasing out the manpower agency provided nurses.
OPA Response
CHC pays manpower agencies an established amount for each category of nurse provided. Tocompare the cost of direct hiring of nurses, OPA attempted to identify all costs associated withhiring of a nurse, i.e. air fare, housing, salary, benefits etc., and compared the total of these costswith what CHC pays manpower agencies. OPA was, however, unable to calculate administrativecosts, such as the cost to recruit nurses because of the difficulty of quantifying such cost, but agreethat this may be an added cost involved in direct hiring.
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While Paras claims that manpower nurses, unlike direct hires, have a strong desire to go to theU.S., our interviews with manpower nurses indicated many had strong ties to the community hereand would give consideration to remaining in the CNMI if given equal treatment with direct hirenurses. While Paras also claims that nurses leave because of greater job security in the mainland,OPA must point out that given the shortage of nurses in the CNMI, job security should not bea factor if nurses are performing satisfactorily.
Sincerely,
Michael S. Sablan, CPAPublic Auditor
cc: GovernorLt. GovernorPresident of the SenateSpeaker of the HouseAttorney GeneralSpecial Assistant for Management and BudgetSecretary of FinancePresident, Paras Enterprises Saipan, Inc. (Paras)Vice President, Saipan Employment Agency and Services, Inc. (SEAS)Administrator, Marianas Health Services (MHS)Press
Appendix A
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Cos
t fo
r C
ashi
ngEs
timat
ed Y
earl
y
(Not
e 3)
$700/m
o.
Bene
fit C
ost
of
Ann
ual H
ousi
ng
(24%
)C
urre
nt R
ate
Cos
t Ba
sed
onC
ontr
ibut
ion
Retir
emen
tA
nnua
l
(4%
)C
urre
nt Ra
te
Base
d on
Insu
ranc
e C
ost
Hea
lth &
Life
(Not
e 2)
$1,9
53.7
8/y
r.
Goo
ds
of H
ouse
hold
Ship
men
t C
ost
Ann
ualiz
ed
(Not
e 2)
Air
Far
e $270/y
r.
Ann
ualiz
ed C
ost
of
Serv
ice
Cos
t C
ompe
nsat
ion
orTo
tal A
nnua
l
(Not
e 1)
Nig
ht D
iffer
entia
lA
nnua
l Cos
t of
Estim
ated
Cos
t Sa
lary
or
Serv
ice
Ann
ualiz
ed
Posi
tions
C
urre
nt
No.
of
Hou
rly
Rate
Se
rvic
e C
ost
Ann
ual R
ates
of
Sala
ry o
rP
o s
i t i
o n
Esti
ma
ted
Ad
dit
ion
al C
ost
to C
on
vert
Cu
rren
t M
an
pow
er
Ag
en
cy N
urs
es
to D
irect
Hir
eEs
tim
ate
d A
dd
itio
na
l C
ost
to C
on
vert
Cu
rren
t M
an
pow
er
Ag
en
cy N
urs
es
to D
irect
Hir
e a
s a
Perc
en
tag
e o
f M
an
pow
er
Hir
ing
Cost
s ($
1,5
12,0
11 /
$4,0
75,3
00)
Act
ua
l Se
rvic
e C
ost
Pa
id t
o M
an
pow
er
Ag
en
cies
in F
Y 2001
Esti
ma
ted
ad
dit
ion
al C
ost
as
a P
erc
en
tag
e o
f FY
2001 A
ctu
al Se
rvic
e C
ost
($1,
512,
011
/ $4
,253
,138
)
Cost
Com
pa
riso
n -
Con
vers
ion
of
Dir
ect
Hir
e v
s C
on
tra
ctin
g T
hro
ug
h M
an
pow
er
Ag
en
cies
Low
-end
Cos
t A
naly
sis:
Ass
umin
g N
urse
s Pr
ovid
ed b
y M
anpo
wer
Age
ncie
s W
ill b
e C
onve
rted
to
Dir
ect
Hir
e St
atus
at
Sala
ry &
Fri
nge
Bene
fit R
ates
App
licab
le t
o Th
eir
Cur
rent
Cre
dent
ials
DIR
ECT
HIR
E -
Esti
ma
ted
cost
ba
sed
on
an
tici
pa
ted
ra
tes
of
sala
ry a
nd
ben
efi
ts t
o b
e p
aid
$3,9
31,2
21$1
,653
,870
$108
,418
$697
,200
$572
,584
$91,
094
$162
,164
$22,
410
$2,2
77,3
51$1
08,4
45$2
,168
,905
83$1
2.56
$26,
131
BSN
NC
LEX
0-1
Yrs.
Exp
.
344,
405
142,
740
9,60
258
,800
50,7
048,
067
13,6
761,
890
201,
665
9,60
319
2,06
27
13.1
927
,437
BSN
NC
LEX
1-2
Yrs.
Exp
.
255,
636
104,
396
7,20
242
,000
38,0
266,
050
9,76
91,
350
151,
239
7,20
214
4,03
85
13.8
528
,808
BSN
NC
LEX
2-3
Yrs.
Exp
.
532,
796
245,
977
13,6
5711
7,60
072
,114
11,4
7327
,353
3,78
028
6,81
813
,658
273,
160
149.
3819
,511
LPN
0-1
Yrs
. Exp
.
78,8
5035
,833
2,04
916
,800
10,8
161,
721
3,90
854
043
,017
2,04
840
,969
29.
8520
,485
LPN
1-2
Yrs
. Exp
.
204,
309
91,4
015,
377
42,0
0028
,389
4,51
69,
769
1,35
011
2,90
95,
377
107,
532
510
.34
21,5
06LP
N 2
-3 Y
rs. E
xp.
179,
348
93,0
154,
112
50,4
0021
,707
3,45
311
,723
1,62
086
,333
4,11
182
,222
66.
5913
,704
Hem
odia
lysi
s Te
chni
cian
0-1
Yrs
. Exp
.
30,8
5515
,746
720
8,40
03,
799
604
1,95
427
015
,108
719
14,3
891
6.92
14,3
89H
emod
ialy
sis
Tech
nici
an 1
-2 Y
rs. E
xp.
29,8
9115
,502
685
8,40
03,
618
576
1,95
427
014
,389
685
13,7
041
6.59
13,7
04O
pera
ting
Rm T
echn
icia
n 0-
1 Yr
s. E
xp.
$5,5
87,3
11$2
,398
,481
$151
,822
$1,0
41,6
00$8
01,7
57$1
27,5
53$2
42,2
69$3
3,48
0$3
,188
,830
$151
,849
124
TOTA
LS
MA
NP
OW
ER H
IRIN
G -
Est
ima
ted
cost
com
pu
ted
pu
rsu
an
t to
ba
se r
ate
s p
rovi
ded
in
th
e c
on
tra
ct
$3,2
77,5
00N
AN
AN
AN
AN
AN
AN
A$3
,277
,500
NA
$3,2
77,5
0095
$16.
59$3
4,50
0Re
gite
red
Nur
se (R
N)
609,
000.
00N
AN
AN
AN
AN
AN
AN
A60
9,00
0.00
NA
609,
000
2113
.94
29,0
00Li
cens
e Pr
actic
al N
urse
(LPN
)
165,
200.
00N
AN
AN
AN
AN
AN
AN
A16
5,20
0.00
NA
165,
200
711
.35
23,6
00H
emod
ialy
sis
Tech
nici
an
23,6
00.0
0N
AN
AN
AN
AN
AN
AN
A23
,600
.00
NA
23,6
001
11.3
523
,600
Ope
ratin
g Ro
om T
echn
icia
n
$4,0
75,3
00N
AN
AN
AN
AN
AN
AN
A$4
,075
,300
NA
$4,0
75,3
0012
4TO
TALS
NA-
not
app
lican
ble
$1,5
12,0
11
37%
$4,2
53,1
38
36%
Not
e 1
- To
fact
or in
nig
ht d
iffer
entia
l, th
e an
alys
is a
ssum
es th
at c
erta
in p
ositi
ons
will
be
assi
gned
and
be
earn
ing
nigh
t diff
eren
tial f
or 1
/3 o
f of t
he to
tal a
vaila
ble
hour
s pe
r ye
ar.
Not
e 2
- To
fact
or in
air
trans
porta
tatio
n &
shi
pmen
t of h
ouse
hold
effe
cts
(Rec
ruitm
ent/
Repa
triat
ion
Cos
ts),
the
anal
ysis
ass
umed
the
follo
win
g:a.
A d
irect
hire
nur
se w
ill m
ost l
ikel
y st
ay fo
r an
ave
rage
of 5
yea
rs th
eref
ore
recr
uitm
ent/
repa
triat
ion
cost
s ca
n be
spr
ead
over
a 5
-yea
r pe
riod.
b. A
s m
ost o
f the
cur
rent
man
pow
er h
ired
nurs
es a
re fr
om th
e Ph
ilipp
ines
, air
trans
porta
tion
and
ship
ping
rat
es a
pplic
able
to th
at d
estin
atio
n w
ere
used
.c.
To
fact
or in
pos
sibl
e ad
ditio
nal a
ir-fa
re c
ost f
or d
epen
dent
s, th
e an
alys
is a
ssum
es th
at 5
0% o
f hire
es h
ave
no d
epen
dent
s an
d 50
% h
ave
at le
ast o
ne d
epen
dent
.N
ote
3 -
To fa
ctor
in h
ousi
ng b
enef
its w
hich
var
y ba
sed
on th
e st
atus
of t
he e
mpl
oyee
, the
ana
lysi
s al
so a
ssum
es th
at h
alf o
f the
hire
es w
ill h
ave
depe
nden
ts a
nd h
alf w
ill h
ave
none
.N
ote
4 -
To fa
ctor
in c
ost o
f acc
umul
ated
ann
ual l
eave
hou
rs, t
he a
naly
sis
assu
mes
that
hal
f of (
104
hrs.
) of a
nnua
l lea
ve h
ours
acc
rued
will
be
used
whi
le h
alf w
ould
be
conv
erte
d to
cas
h.
Appendix B
Page 14 of 29
Tota
l Ann
ual C
ost
Cos
tPe
rson
nel B
enef
itTo
tal A
nnua
l
(Not
e 4)
Ann
ual L
eave
Acc
umul
ated
Cos
t fo
r C
ashi
ngEs
timat
ed Y
earl
y
(Not
e 3)
$700/m
o.
Bene
fit C
ost
ofA
nnua
l Hou
sing
(24%
)C
urre
nt R
ate
Cos
t Ba
sed
onC
ontr
ibut
ion
Retir
emm
ent
Ann
ual
on C
urre
nt R
ate
(4%
)In
sura
nce
Cos
t Ba
sed
Hea
lth &
Life
(Not
e 2)
@ $
1, 953.7
8/y
r H
ouse
hold
Goo
ds
Ship
men
t C
ost
ofA
nnua
lized
(Not
e2)
Air
Far
e @
$270/y
rA
nnua
lized
Cos
t of
Serv
ice
Cos
tC
ompe
nsat
ion
orTo
tal A
nnua
l
Diff
eren
tial (
Not
e 1)
Cos
t of
Nig
htEs
timat
ed A
nnua
l
Cos
tSa
lary
or
Serv
ice
Ann
ualiz
ed
Posi
tions
Cur
rent
No.
of
Hou
rly
Rate
Serv
ice
Cos
tA
nnua
l Rat
es o
f Sa
lary
or
P o
s i t
i o
n
TOTA
LS
MA
NP
OW
ER H
IRIN
G -
Est
ima
ted
cost
com
pu
ted
pu
rsu
an
t to
ba
se r
ate
s p
rovi
ded
in
th
e c
on
tra
ct (N
ote
5)
Regi
tere
d N
urse
(RN
)
Lice
nse
Prac
tical
Nur
se (L
PN)
Hem
odia
lysi
s Te
chni
cian
Ope
ratin
g Ro
om T
echn
icia
n
TOTA
LS
Esti
ma
ted
Ad
dit
ion
al C
ost
to C
on
vert
Cu
rren
t M
an
pow
er
Ag
en
cy N
urs
es
to D
irect
Hir
eEs
tim
ate
d A
dd
itio
na
l C
ost
to C
on
vert
Cu
rren
t M
an
pow
er
Ag
en
cy N
urs
es
to D
irect
Hir
e a
s a
Perc
en
tag
e o
f M
an
pow
er
Hir
ing
Cost
s($2,6
18,1
72/$
4,0
75,3
00)
Act
ua
l Se
rvic
e C
ost
Pa
id t
o M
an
pow
er
Ag
en
cies
in F
Y 2001
Esti
ma
ted
ad
dit
ion
al C
ost
as
a P
erc
en
tag
e o
f FY
2001 A
ctu
al Se
rvic
e C
ost
($2,6
18,1
72/$
4,2
53,1
38)
Cost
Com
pa
riso
n -
Con
vers
ion
of
Dir
ect
Hir
e v
s C
on
tra
ctin
g T
hro
ug
h M
an
pow
er
Ag
en
cies
Hig
h-en
d C
ost
Ana
lysi
s: A
ssum
ing
That
Onl
y N
urse
s W
ho P
asse
d th
e N
CLE
X &
with
5 Y
rs. of
Exp
erie
nce
Will
be
Hir
ed
DIR
ECT
HIR
E -
Esti
ma
ted
cost
ba
sed
on
an
tici
pa
ted
ra
tes
of
sala
ry a
nd
ben
efi
ts t
o b
e p
aid
$5,4
63,1
89$2
,136
,983
$158
,376
$798
,000
$836
,300
$133
,048
$185
,609
$25,
650
$3,3
26,2
06$1
58,3
91$3
,167
,815
95$1
6.03
$33,
345
BSN
NC
LEX
5+ Y
rs. E
xp.
957,
993
409,
183
26,1
4217
6,40
013
7,98
921
,952
41,0
295,
670
548,
810
26,1
3452
2,67
621
11.9
724
,889
LPN
5+
Yrs
. Exp
.
238,
255
115,
866
5,83
158
,800
30,7
734,
896
13,6
761,
890
122,
389
5,82
811
6,56
17
8.01
16,6
52H
emod
ialy
sis
Tech
nici
an 5
+ Y
rs. E
xp.
34,0
3616
,552
833
8,40
04,
396
699
1,95
427
017
,484
833
16,6
511
8.01
16,6
51O
R Te
chni
cian
5+
Yrs
. Exp
.
$6,6
93,4
72$2
,678
,585
$191
,183
$1,0
41,6
00$1
,009
,457
$160
,596
$242
,269
$33,
480
$4,0
14,8
88$1
91,1
85$3
,823
,703
124
$3,2
77,5
00N
AN
AN
AN
AN
AN
AN
A$3
,277
,500
NA
$3,2
77,5
0095
$16.
59$3
4,50
0
609,
000
NA
NA
NA
NA
NA
NA
NA
609,
000
NA
609,
000
2113
.94
29,0
00.0
0
165,
200
NA
NA
NA
NA
NA
NA
NA
165,
200
NA
165,
200
711
.35
23,6
00.0
0
23,6
00N
AN
AN
AN
AN
AN
AN
A23
,600
NA
23,6
001
11.3
523
,600
.00
$4,0
75,3
00N
AN
AN
AN
AN
AN
AN
A$4
,075
,300
NA
$4,0
75,3
0012
4
NA-
not
app
lican
ble
$2,6
18,1
72
64%
$4,2
53,1
38
62%
Not
e 1
- To
fact
or in
nig
ht d
iffer
entia
l, th
e an
alys
is a
ssum
es th
at c
erta
in p
ositi
ons
will
be
assi
gned
and
be
earn
ing
nigh
t diff
eren
tial f
or 1
/3 o
f of t
he to
tal a
vaila
ble
hour
s pe
r ye
ar.
Not
e 2
- To
fact
or in
air
trans
porta
tatio
n &
shi
pmen
t of h
ouse
hold
effe
cts
(Rec
ruitm
ent/
Repa
triat
ion
Cos
ts),
the
anal
ysis
ass
umed
the
follo
win
g:a.
A d
irect
hire
nur
se w
ill m
ost l
ikel
y st
ay fo
r an
ave
rage
of 5
yea
rs th
eref
ore
recr
uitm
ent/
repa
triat
ion
cost
s ca
n be
spr
ead
over
a 5
-yea
r pe
riod.
b. A
s m
ost o
f the
cur
rent
man
pow
er h
ired
nurs
es a
re fr
om th
e Ph
ilipp
ines
, air
trans
porta
tion
and
ship
ping
rat
es a
pplic
able
to th
at d
estin
atio
n w
ere
used
.c.
To
fact
or in
pos
sibl
e ad
ditio
nal a
ir-fa
re c
ost f
or d
epen
dent
s, th
e an
alys
is a
ssum
es th
at 5
0% o
f hire
s ha
ve n
o de
pend
ents
and
50%
hav
e at
leas
t one
dep
ende
nt.
Not
e 3
- To
fact
or in
hou
sing
ben
efits
whi
ch v
ary
base
d on
the
stat
us o
f the
em
ploy
ee, t
he a
naly
sis
also
ass
umes
that
hal
f of t
he h
irees
will
hav
e de
pend
ents
and
hal
f will
hav
e no
ne.
Not
e 4
- To
fact
or in
cos
t of a
ccum
ulat
ed a
nnua
l lea
ve h
ours
, the
ana
lysi
s as
sum
es th
at h
alf o
f (10
4 hr
s.) o
f ann
ual l
eave
hou
rs a
ccru
ed w
ill b
e us
ed w
hile
hal
f wou
ld b
e co
nver
ted
to c
ash.
Not
e 5
- M
ost o
f the
man
pow
er n
urse
s pr
ovid
ed u
nder
the
curr
ent c
ontra
cts
do n
ot h
ave
NC
LEX
and
five
year
s of
exp
erie
nce.
Appendix C
Page 15 of 29
Con
trib
utio
nof
Ret
irem
ent
With
out
the
Ann
ual C
ost
Tota
l Ann
ual C
ost
Con
trib
utio
n C
ost
Ann
ual R
etir
emen
tTo
tal A
nnua
l Cos
t Be
nefit
Tota
l Ann
ual C
ost
of P
erso
nnel
Serv
ice
Cos
t C
ompe
nsat
ion
orTo
tal A
nnua
l
P o
s i t
i o
n
Esti
ma
ted
Ad
dit
ion
al C
ost
to C
on
vert
Ma
np
ow
er
Ag
en
cy N
urs
es
to D
irect
Hir
eEs
tim
ate
d A
dd
itio
na
l C
ost
as
a P
erc
en
tag
e o
f M
an
pow
er
Hir
ing
Cost
s
Act
ua
l Se
rvic
e C
ost
Pa
id t
o M
an
pow
er
Ag
en
cies
in F
Y 2001
Esti
ma
ted
ad
dit
ion
al C
ost
as
a P
erc
en
tag
e o
f FY
2001 A
ctu
al Se
rvic
e C
ost
Com
pa
riso
n o
f C
ost
- D
irect
Hir
e v
s C
on
tra
ctin
g M
an
pow
er
Ag
en
cies
Low
-End
Cos
t A
naly
sis:
Con
vers
ion
of N
urse
s at
Com
pens
atio
n Ra
tes
App
licab
le t
o Th
eir
Cur
rent
Cre
dent
ials
A
ssum
ing
They
W
ould
Ele
ct N
ot t
o be
a P
art
of t
he C
NM
I Ret
irem
ent
Syst
em
DIR
ECT
HIR
E -
Esti
ma
ted
cost
ba
sed
on
an
tici
pa
ted
ra
tes
of
sala
ry a
nd
ben
efi
ts t
o b
e p
aid
$3,3
58,6
36$5
72,5
84$3
,931
,221
$1,6
53,8
70$2
,277
,351
BSN
NC
LEX
0-1
Yrs.
Exp
.
293,
701
50,7
0434
4,40
514
2,74
020
1,66
5BS
N N
CLE
X 1-
2 Yr
s. E
xp.
217,
610
38,0
2625
5,63
610
4,39
615
1,23
9BS
N N
CLE
X 2-
3 Yr
s. E
xp.
460,
681
72,1
1453
2,79
624
5,97
728
6,81
8LP
N 0
-1 Y
rs. E
xp.
68,0
3510
,816
78,8
5035
,833
43,0
17LP
N 1
-2 Y
rs. E
xp.
175,
921
28,3
8920
4,30
991
,401
112,
909
LPN
2-3
Yrs
. Exp
.
157,
641
21,7
0717
9,34
893
,015
86,3
33H
emod
ialy
sis
Tech
nici
an 0
-1 Y
rs. E
xp.
27,0
563,
799
30,8
5515
,746
15,1
08H
emod
ialy
sis
Tech
nici
an 1
-2 Y
rs. E
xp.
26,2
743,
618
29,8
9115
,502
14,3
89O
pera
ting
Rm T
echn
icia
n 0-
1 Yr
s. E
xp.
$4,7
85,5
54$8
01,7
57$5
,587
,311
$2,3
98,4
81$3
,188
,830
TOTA
LS
MA
NP
OW
ER H
IRIN
G -
Est
ima
ted
cost
com
pu
ted
pu
rsu
an
t to
ba
se r
ate
s p
rovi
ded
in
th
e c
on
tra
ct
$3,2
77,5
00N
A$3
,277
,500
NA
$3,2
77,5
00Re
gite
red
Nur
se (R
N)
609,
000
NA
609,
000
NA
609,
000
Lice
nse
Prac
tical
Nur
se (L
PN)
165,
200
NA
165,
200
NA
165,
200
Hem
odia
lysi
s Te
chni
cian
23,6
00N
A23
,600
NA
23,6
00O
pera
ting
Room
Tec
hnic
ian
$4,0
75,3
00N
A$4
,075
,300
NA
$4,0
75,3
00TO
TALS
NA-
not
app
lican
ble
Cost
Wit
hou
t R
eti
rem
en
tC
ost
Wit
h R
eti
rem
en
t$7
10,2
54$1
,512
,011
317
%1
37%
$4,2
53,1
38$4
,253
,138
417
%2
36%
1 ($
1,5
12
,01
1/
$4
,07
5,3
00
)=3
7.1
0%
or
37
%2 ($
1,5
12
,01
1 /
$4
,25
3,1
38
)=3
5.5
5%
or
36
%3
($7
10
,25
4 /
$4
,07
5,3
00
)=1
7.4
3%
or
17
%4
($7
10
,25
4 /
$4
,25
3,1
38
)=1
6.7
0%
or1
7%
Appendix D
Page 16 of 29
CN
MI R
etir
emen
t Sy
stem
Con
trib
utio
nC
ost
of R
etir
emen
tW
ithou
t th
e A
nnua
lTo
tal A
nnua
l Cos
t
Con
trib
utio
n C
ost
Ann
ual R
etir
emm
ent
Tota
l Ann
ual C
ost
Tota
l Ann
ual C
ost
of P
erso
nnel
Ben
efits
or
Ser
vice
Cos
tC
ompe
nsat
ion
Tota
l Ann
ual
P o
s i t
i o
n
MA
NP
OW
ER H
IRIN
G -
Est
ima
ted
cost
com
pu
ted
pu
rsu
an
t to
ba
se r
ate
s p
rovi
ded
in
th
e c
on
tra
ct5
Ad
dit
ion
al C
ost
to C
on
vert
Cu
rren
t N
um
ber
of
Ma
np
ow
er
Ag
en
cy N
urs
es
to D
irect
Hir
eEs
tim
ate
d A
dd
itio
na
l C
ost
as
a P
erc
en
tag
e o
f M
an
pow
er
Hir
ing
Cost
s
Esti
ma
ted
ad
dit
ion
al C
ost
as
a P
erc
en
tag
e o
f FY
2001 A
ctu
al Se
rvic
e C
ost
Cost
Com
pa
riso
n -
Dir
ect
Hir
e v
s C
on
tra
ctin
g T
hro
ug
h M
an
pow
er
Ag
en
cies
Hig
h-En
d C
ost
Ana
lysi
s: C
onve
rsio
n of
Nur
ses
Who
Pas
sed
the
NC
LEX
& w
ith 5
Yrs
. of
Exp
erie
nce
Ass
umin
g Th
ey W
ould
Ele
ct N
ot t
o be
a P
art
of t
he
DIR
ECT
HIR
E -
Esti
ma
ted
cost
ba
sed
on
an
tici
pa
ted
ra
tes
of
sala
ry a
nd
ben
efi
ts t
o b
e p
aid
$4,6
26,8
89$8
36,3
00$5
,463
,189
$2,1
36,9
83$3
,326
,206
BSN
NC
LEX
5+ Y
rs. E
xp.
820,
004
137,
989
957,
993
409,
183
548,
810
LPN
5+
Yrs
. Exp
.
207,
482
30,7
7323
8,25
511
5,86
612
2,38
9H
emod
ialy
sis
Tech
nici
an 5
+ Y
rs. E
xp.
29,6
404,
396
34,0
3616
,552
17,4
84O
R Te
chni
cian
5+
Yrs
. Exp
.
$5,6
84,0
15$1
,009
,457
$6,6
93,4
72$2
,678
,585
$4,0
14,8
88TO
TALS
$3,2
77,5
00N
A$3
,277
,500
NA
$3,2
77,5
00Re
gite
red
Nur
se (R
N)
609,
000
NA
609,
000
NA
609,
000
Lice
nse
Prac
tical
Nur
se (L
PN)
165,
200
NA
165,
200
NA
165,
200
Hem
odia
lysi
s Te
chni
cian
23,6
00N
A23
,600
NA
23,6
00O
pera
ting
Room
Tec
hnic
ian
$4,0
75,3
00N
A$4
,075
,300
NA
$4,0
75,3
00TO
TALS
NA-
not
app
lican
ble
Cost
Wit
hou
t R
eti
rem
en
tC
ost
Wit
h R
eti
rem
en
t3
$1,6
08,7
151
$2,6
18,1
7239
%64
%
$4,2
53,1
38$4
,253
,138
Act
ua
l Se
rvic
e C
ost
Pa
id t
o M
an
pow
er
Ag
en
cies
in F
Y 2001
438
%2
62%
1 ($
2,6
18
,17
2 /
$4
,07
5,3
00
)=6
4.2
4%
or
64
%2
($2
,61
8,1
72
/ $
4,2
53
,13
8)=
61
.56
% o
r 6
2%
3 ($
1,6
08
,71
5 /
$4
,07
5,3
00
)=3
9.4
7%
or
39
%4
($1
,60
8,7
15
/ $
4,2
53
,13
8)=
37
.82
% o
r 3
8%
5 M
ost
of t
he m
anpo
wer
nur
ses
prov
ided
und
er t
he c
urre
nt c
ontr
acts
do
not
have
NC
LEX
and
five
year
s of
exp
erie
nce.
Appendix E
Page 17 of 29
Sum
ma
ry o
f R
esp
on
ses
of
Sele
cted
Doct
ors
an
d U
nit
Ma
na
gers
to I
nte
rvie
w Q
uest
ion
s
Con
cern
ing
Nu
rses
Pro
vid
ed
by
Ma
np
ow
er
Ag
en
cies
as
of
Dece
mb
er
31, 2002
Dir
ect
Hir
ing?
Nee
d to
Go
Back
to
Kee
p in
You
r O
wn
Uni
tH
ow M
any
Wou
ld Y
ouC
are?
Aff
ecte
d Pa
tient
Has
Qua
lity
Bein
g Re
tain
ed?
Uns
atis
fact
ory
Nur
ses
Man
pow
er N
urse
s?Be
caus
e of
Mor
e Ba
d In
cide
nts
Nur
ses?
Par
with
DPH
O
nce
Trai
ned,
at
Nee
d M
ore
Trai
ning
?
Tabu
latio
n of
Res
pons
e
and
Bene
fits?
Unj
ustly
Tre
ated
in P
ayK
eep
in Y
our
Ow
n U
nit
How
Man
y W
ould
You
Car
e?A
ffec
ted
Patie
ntH
as Q
ualit
y
Bein
g Re
tain
ed?
Uns
atis
fact
ory
Nur
ses
Man
pow
er N
urse
s?Be
caus
e of
Mor
e Ba
d In
cide
nts
Nur
ses?
Par
with
DPH
Onc
e Tr
aine
d, a
t
Nee
d M
ore
Trai
ning
?
Tabu
latio
n of
Res
pons
e
Doct
ors
:
Yes
All
No
No
No
Yes
No
Doc
tor
1
May
be N
otAl
lYe
sN
AYe
sN
AYe
sD
octo
r 2
Yes
80%
to 9
0% o
f tot
al
Tole
rabl
e Le
vel
Yes
No
Yes
Yes
Doc
tor
3
Yes
than
50%
90%
; On
Floo
r -
less
Out
patie
nt-
80 to
Yes
Yes
NA
Yes
Yes
Doc
tor
4
Yes
1/3
of to
tal
Yes
Yes
Yes
NA
Yes
Doc
tor
5
Yes
10%
to 1
5% o
f tot
alYe
sYe
sYe
sYe
sYe
sD
octo
r 6
5 Ye
s4
Yes
4 Ye
s3
Yes
4 Ye
s5
Yes
1 N
o1
No
1 N
o2
No
0 N
o1
No
1 To
lera
ble
1 N
A1
NA
2 N
A
Nu
rse U
nit
Ma
na
gers
:
Yes
All
No
No
NA
Yes
Yes
Uni
t Man
ager
1
Yes
All
Yes
Yes
No
Yes
Yes
Uni
t Man
ager
2
Yes
10 o
f 15
in u
nit
Yes
Yes
NA
Yes
Yes
Uni
t Man
ager
3
Yes
tota
lm
ore
than
50%
of
Yes
Yes
Yes
NA
Yes
Uni
t Man
ager
4
Yes
6 of
11i
n un
itYe
sYe
sN
AN
AYe
sU
nit M
anag
er 5
Yes
the
unit
No
agen
cy n
urse
s in
NA
No
NA
NA
Yes
Uni
t Man
ager
6
Yes
All
NA
No
NA
NA
No
Uni
t Man
ager
7
NA
80%
in u
nit
Yes
No
NA
NA
Yes
Uni
t Man
ager
8
7 Ye
s5
Yes
4 Ye
s1
Yes
3 Ye
s 7
Yes
0 N
o1
No
4 N
o1
No
0 N
o1
No
1 N
A2
NA
6 N
A5
NA
NA-
No
Answ
er
Appendix F
Page 18 of 29
Sum
ma
ry o
f M
an
pow
er
Ag
en
cy N
urs
es
Resp
on
ses
to I
nte
rvie
w Q
uest
ion
at
Dece
mb
er
31, 2002
Satis
fied
with
Pay
and
Ben
efits
Hir
edD
irec
tlyW
ill S
tay
if
Sala
ry
Ann
ual
CH
CSe
rvic
e A
tYe
ars
of
Expe
rien
ceN
ursi
ngYe
ars
of
Cer
tifie
dN
CLE
XFe
e Pa
idRe
crui
tmen
tA
mou
nt o
f
Age
ncy
Man
pow
er
Nur
seM
edic
alPa
yH
olid
ayLe
ave
Vac
atio
nSi
ck L
eave
Util
ities
Hou
sing
Prov
ided
Empl
oyer
Pay
Regu
lar
NA
NA
NA
NA
NA
No
No
Yes
$17,
680
1.5
6.5
no$1
,000
PARA
S1
No
No
No
No
NA
NA
No
Yes
20,3
8413
23ye
sN
ON
ESE
AS2
NA
NA
NA
NA
NA
Yes
Yes
No
16,6
407
20no
300
PARA
S3
NA
NA
NA
NA
NA
No
NA
Yes
23,1
926
12ye
s40
0M
HS
4
NA
No
No
No
No
Yes
NA
Yes
18,7
201
7no
1,30
0SE
AS5
Yes
No
No
No
No
No
No
Yes
18,5
740.
256
yes
1,50
0SE
AS6
No
No
No
No
Yes
No
NA
Yes
23,1
507
25ye
s30
0PA
RAS
7
Yes
Yes
Yes
Yes
Yes
No
No
Yes
21,9
861.
56.
5ye
sN
ON
EM
HS
8
NA
No
NA
No
NA
NA
No
Yes
21,9
863
24ye
sN
ON
EPA
RAS
9
NA
No
No
NA
No
No
No
Yes
18,7
201
10no
1,56
0SE
AS10
Yes
No
No
NA
No
Yes
No
Yes
21,9
866
16ye
s1,
500
SEAS
11
No
No
No
No
No
Yes
NA
Yes
18,7
201.
58
no1,
500
SEAS
12
No
No
No
No
NA
NA
No
Yes
22,7
148
13ye
s1,
000
PARA
S13
Yes
No
No
Yes
No
No
No
Yes
18,5
747
14ye
s30
0SE
AS14
No
No
No
Yes
Yes
No
No
Yes
21,9
861.
510
.5ye
s1,
500
SEAS
15
No
No
No
Yes
Yes
No
No
No
16,6
4011
15no
1,00
0PA
RAS
16
No
No
No
No
No
No
No
Yes
21,9
861.
57
yes
1,20
0SE
AS17
No
No
No
No
No
No
No
Yes
21,9
8615
22ye
s1,
250
SEAS
18
No
No
No
No
Yes
Yes
No
Yes
21,9
862
7ye
sN
ON
EPA
RAS
19
Yes
No
No
Yes
Yes
Yes
No
Yes
18,5
747
17ye
s1,
200
SEAS
20
5 Ye
s-25
%1
Yes-
5%1
Yes-
5%5
Yes-
25%
6 Ye
s-30
%6
Yes-
30%
1 Ye
s-5%
18 Y
es-9
0%Av
e. S
alar
yAv
e. Y
rs.
Ave.
Yrs
.14
Yes
-70%
Aver
age
Fee
SEAS
- 5
5%
9 N
o-45
%16
No-
80%
15 N
o-75
%10
No-
50%
8 N
o-40
%11
No-
55%
15 N
o-75
%2
No-
10%
$20,
309
5.09
13.4
86
No-
30%
$1,0
51PA
RAS
- 35
%
6 N
A-30
%3
NA-
15%
4 N
A-20
%5
NA-
25%
6 N
A-30
%3
NA-
15%
4 N
A-20
%M
HS
- 10
%
N/A
- N
ot a
pplic
able
Appendix G
Page 1of 1
Page 19 of 29
Appendix H Page 1 of 8
Page20 of 29
Appendix H Page 2 of 8
Page 21 of 29
Appendix H Page 3 of 8
Page 22 of 29
Appendix H Page 4 of 8
Page 23 of 29
Appendix H Page 5 of 8
Page 24 of 29
Appendix H Page 6 of 8
Page 25 of 29
Appendix H Page 7 of 8
Page 26 of 29
Appendix H Page 8 of 8
Page 27 of 29
Appendix I
Page 1 of 2
Page 28 of 29
Appendix I
Page 2 of 2
Page 29 of 29
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