UW Health’s Formula for Sustainable Staffing

UW Health is cutting contract labor costs by investing in internal pipelines, predictive tools, and cross-functional workforce planning.

When workforce expenses dominate operating costs, reducing overreliance on contract labor is one of the most urgent financial to-dos for health systems.

At UW Health, Vice President of Finance Jodilynn Vitello is helping lead a multi-faceted labor strategy that balances cost containment with long-term workforce sustainability, an increasingly complex equation during the ongoing national labor shortage.

The Financial Toll of Contract Labor

Vitello is candid about the financial burden: “The levels of contracted labor that we're using definitely remain significantly higher than where we were even pre-pandemic, five to ten 10 times higher. It’s a significant impact on margins.”

While contract labor helped UW Health remain operational during staffing crises, the extended use of high-premium positions has strained financials and tested long-term viability.

“We continue to see those shortages across our organization,” she noted. “It’s not just nursing, it’s respiratory therapy, medical assistants, surgical techs, —; we’re seeing shortages across the board.”

Building Internal Pipelines: Apprenticeships and Retention

UW Health is now shifting its investments toward sustainable pipeline programs.

“We’ve created a number of apprentice programs focused on hard-to-fill roles,” said Vitello. These programs are tailored to bring new talent into the mix earlier and support their progression through clinical education.”

Equally vital are UW’s retention efforts. The health system has maintained a consistent compensation game-plan, implementing market-aligned adjustments year-over-year.

“That includes across-the-board raises, salary range shifts, and, when needed, targeted retention bonuses,” Vitello explained. While used sparingly, retention bonuses are tracked alongside other workforce investments to evaluate ROI.

The Collaboration Trifecta: Finance, HR, and Clinical Leadership

A cornerstone of UW Health’s business strategy is cross-functional collaboration.

“Finance and HR are tightly aligned,” Vitello said, “and we partner directly with clinical leaders to understand real-time staffing needs and workforce challenges.”

This approach allows UW Health to respond quickly to labor gaps while ensuring investments are aligned with care delivery priorities.

Predictive Planning & Tech Tools

To more effectively manage the transitions from contract to permanent staffing, UW Health has implemented detailed labor tracking tools, allowing leaders to forecast contract expirations, assess upcoming labor gaps, and adjust recruiting efforts accordingly.

“We track what the next thirteen weeks look like,” Vitello said. “So while not necessarily longer term in this example, we’re still looking at predicting which travelers might be able to roll off, which ones may need to remain. That visibility helps determine whether we extend, replace, or absorb the role internally.”

The organization hasn’t fully deployed AI tools for labor management, and Vitello is cautious.

“We’re in an exploratory phase,” she said. “We’re focused on understanding what tools can do today and whether they align with our operational reality.”

While UW Health’s investment in Oracle Cloud has already improved efficiency across finance, HR, and supply chain, Vitello said the health system’s next frontier might involve expanding its scheduling functionality to optimize strategic workforce deployment.

Balancing Cost and Culture and Contracts

Currently, UW Health is narrowing its agency relationships to improve pricing leverage and data transparency.

“We’ve worked to funnel most of our agency activity through a single partner,” Vitello explained. “It allows us to consolidate scale, manage contracts more effectively, and maintain better audit readiness.”

Ultimately, Vitello noted, the transition away from contract labor dependency is as much about culture as it is about cost, with the goal being to retain employees who want to stay at the organization.

“The barrier isn’t just operational, it’s about finding people who want to work the third shift or weekends,” she admitted. Vitello’s finance team is supporting efforts to make these roles more attractive through compensation, support, and career growth.