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Nurse Residency Programs Pay For Themselves

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   August 31, 2010

Summer-graduating nurses are starting their first jobs, and hospitals are beginning the arduous task of turning novices into competent, professional RNs.

The leap from nursing school to practice is tough and many hospitals complain that nursing school does not prepare students for the real world of nursing.

"The newest literature and research says we need to transform nursing education across the nation," says Jim Hansen, supervisor of new graduate and student services at Kootenai Health in Coeur d'Alene, ID. "There's a gigantic gap in the way nurses are currently prepared and how hospitals need them to practice. Thus far, the ones who have been working to bridge the gap are the hospitals."

The concept of nurse residency programs has emerged to fill the gap between school and practice. Similar to physician residency programs, the intent is to continue education, mentoring, and support to enable novices to become competent practitioners.

"There's a very high degree of turnover among new graduate nurses," says Hansen. "The literature varies widely, but it can be as high as 60% in the first year at some hospitals. They spend a lot of money onboarding, training, and orienting these nurses only to have them turn around and leave."

Hansen says a residency program helps increase retention and lower turnover, which justifies the investment in developing a program.

"It always comes down to money," he says. "We can justify the costs incurred by the money saved in reducing nurse turnover."


In a large hospital system with significant new graduate turnover, Hansen estimates residency programs could save $200,000-$400,000 per year. Even small organizations can save thousands, which can more than pay for the time and expense of instituting programs.

Nurse residency programs are much more involved than what happens during orientation and preceptorships. They are structured programs that last longer—typically a year, although some hospitals have shorter programs—and that support new grads with ongoing education and mentoring.

Hospitals design programs that meet their needs. A typical curriculum includes ongoing clinical education, development of skills such as critical thinking, and social networking. Many new graduates report that time spent with other new grads is the most helpful part of the program, allowing them a much-needed outlet to decompress and share stories, receiving comfort from finding others are in the same boat.

Hansen says Kootenai Health views the residency program as an investment in the professionalism of its nurses. When designing the program, he focused on the end point. "What kind of a nurse do we want to have?" he says. "We want good nurses who provide excellent care and are committed to staying working with us."

He examined the gaps that had been identified between school and practice and set out to include education in technical skills, as well as what he calls "professional comportment," including critical thinking, organizational skills, prioritization skills, professionalism, and interacting with physicians, pharmacy, and all the members of the care team.

Hansen says new graduate nurses often fall short on communication and leadership skills, "so hospitals have to pick up the slack." Residency programs can fill in the gaps by teaching new nurses how to:

  • Interact with peers and other professionals
  • Lead clinical conferences or rounds
  • Think critically
  • Grow professionally

They can also contribute to professional development by helping new nurses gain an understanding of research and evidence-based practice so they can apply it at the bedside, which is crucial for hospitals' ongoing efforts to improve clinical outcomes.

Rebecca Hendren is a senior managing editor at HCPro, Inc. in Danvers, MA. She edits and manages The Leaders' Lounge blog for nurse managers. Email her at

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