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Housing crunch means Montana hospitals can't find, keep workers

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In a statement that will surprise nearly no one, it’s hard to find a place to live in Montana.

Across seemingly all industries in the state, employers are struggling to recruit and retain workers increasingly priced out of the home market. For hospitals, high demand on housing is compounding recruitment and retention efforts at the same time facilities need more workers than ever before to handle the surge in patients during the pandemic.

The parallel problems have left hospitals around the state in difficult situations, like when earlier this year Bozeman Health reported more than 400 open positions. Some have pursued creative fixes, though none have landed on a perfect solution.

In response to a recent survey by the Montana Hospital Association, one hospital reported four out of a dozen new hires were living in camp trailers because of a lack of affordable housing.

Housing was the most-cited issue hospitals said made it hard to recruit new employees. Other responses captured in the survey feel like being captured in an echo chamber for anyone who's tried to rent or purchase a home in the last year:

  • "limited options, high price,”
  • “expensive,”
  • “short term rentals are hard to find,”
  • “lack of newer homes that are affordable,”
  • “many people have moved here due to COVID-19, leaving very little available in the housing market,”
  • “hard to find especially at the lower income,”
  • and “rental options limited.”

A two-pronged problem

The challenge facing hospitals and the employees they're trying to hire or keep has two components — one is finding housing that’s available and the other is finding housing that’s affordable.

Numbers kept by the Realtor.com Real Estate Data Library illustrate the availability side. The number of active listings reported each month has been trending down for years, though the pandemic has exacerbated the supply crunch.

The peak number of active home listings during any month of 2021 was down in all the larger counties from 2019, and in some places the supply was only a third of what it was two years ago, according to the data.

For example, the most homes actively listed in Yellowstone County reached 687 in 2019, but was just 222 this year, according to the data. Missoula, Cascade and Lewis and Clark counties all saw peak inventory this year stay less than 40% of what it was two years ago.

Flathead and Gallatin counties fared among the best in the state, though they still saw housing supply down, with the Flathead reporting this year’s active listings at about 48% of 2019 and Gallatin's at 82%.

Peak active listings

The lack of housing has only fueled the affordability issue. The website Zillow puts the typical value of a home in Montana at $394,498, a 27.8% rise from September 2020. But that average looks higher in the communities that are home to the state’s largest hospitals — the 59715 zip code, home to Bozeman Health, reported a typical value of $907,000, up from $560,000 in 2019.

While some might scoff at the idea of a doctor not being able to afford an expensive house, Rich Rasmussen, the president and CEO of the Montana Hospital Association, said Montana is driven by primary care physicians, which are not compensated at the highest levels like a neurosurgeon. The high cost of housing is also a deterrent to young physicians just leaving medical school and carrying a lot of debt, Rasmussen said.

“Their income has not grown or been able to catch up with their peers with more experience and they still need housing, so it’s a challenge for them as well,” Rasmussen said.

And not everyone who works in the hospital is a doctor or nurse, Katy Peterson, vice president of communications and member engagement for the association, pointed out.

“Affordable housing is a priority because of the large share of hospital employees (who) are not necessarily the highest-paid workers in the community,” Peterson said.

Missoula construction

Access to housing is just as important as affordability, Rasmussen said.

“If you don’t have the housing, that provider won’t come to that community,” he said.

Not a new problem

Just as housing stock was dropping in Montana as prices were rising well before the pandemic, hospitals have struggled for some time with attracting and keeping employees who couldn't find a place to live, Rasmussen said. But now it's worse than ever.

“It’s become even more acute during the pandemic,” Rasmussen said. “As folks are looking to potentially relocate, hospitals are walking into the wall of inadequate supply of housing and certainly affordable housing.”

Part of the issue is hospitals also need surge staffing to manage an influx of COVID-19 patients. While the number of people hospitalized with the virus was more than 260 earlier this week, down dramatically from highs pushing close to 500 earlier in the fall, hospitals still need more doctors, nurses and more to care for patients coming in sicker with the delta variant.

At Glendive Medical Center, CEO Parker Powell said in early November the hospital was averaging five or six more patients a day than before the pandemic and had about 45 job openings, a number that historically has hovered around 20-25.

Glendive Medical Center is a critical access, 25-bed hospital. It operates its own nursing home and a veterans nursing home for the state. Critical access is a designation given to some rural hospitals by the Centers for Medicare and Medicaid. The designation is meant to help reduce the hospital's financial vulnerably and ensure rural places have access to care.

“Pre-pandemic, we always had staffing challenges,” Powell said in a recent interview. “It was always a challenge for us to get staff into Glendive, Montana.”

Glendive Medical Center

Glendive Medical Center in Glendive has purchased homes around the hospital to help house workers.

When people think of moving to Montana, they generally think about mountains and not plains and badlands, Powell said. That meant even before the pandemic, Glendive Medical Center relied heavily on traveling staff, particularly for clinical staff like registered nurses and certified nursing assistants.

But then COVID-19 hit, and hospitals around the nation needed surge staffing to treat waves of COVID-19 patients. At the same time, a ripple of retirees and people left the health care field because of the dangers, stress and sometimes hostility toward health care workers.

That meant everyone across the country needed traveling health care workers to meet their demand, leaving hospitals like Glendive without the options they had before.

“It’s been difficult, absolutely,” Parker said. “When the pandemic hit, everybody started using travelers and that’s when it became challenging and difficult. The pool is only so big.”

Creative fixes

In some ways, Powell said, the Glendive hospital has been down this road before and knows how to navigate the staffing shortage. When the Bakken took off, a not-insignificant number of people were able to become stay-at-home parents and left jobs at the hospital, Powell said. The region's housing supply also shrunk, dominated by oilfield workers and their families who filled rentals, hotel rooms and almost anywhere else someone could find to call home.

From that time, the Glendive hospital found ways to try to address the shortage of housing, mainly by creating its own.

“We were able to over time purchase some of the houses literally across the street, with the intent we would use these houses not only for traveling staff but also for new recruits,” Powell said.

The hospital’s foundation also partnered with a local man who, using a charitable remainder unitrust donation, gave the foundation an eight-plex to use for housing staff. The hospital also has a lease with a local hotel for a few rooms to house travelers.

In total, Glendive Medical Center owns 10 houses around the facility plus the eight-plex apartment building and rents three apartments and four hotel rooms.

For the most part, it’s worked out well, Powell said. The housing gives new permanent staff time to decide where they want to live. If there’s not much on the market — which is common — it’s likely something will come up over the six months of their temporary housing.

“We feel like it’s a pretty good incentive to be able to tell somebody ‘Come here, we’ve got you a place to stay and you don’t have to worry about making an extra trip to try to find a house,’” Powell said. “They can get out here, get their practice going and not have to find housing.”

Still, even with all those options for housing workers, the last nearly two years have been more challenging than normal, Powell said. Anecdotally, he said a lot of out-of-staters moved into area homes site-unseen. And the demand for traveling nurses nationally has not eased while patient volumes are still up in Glendive.

All of the hospital’s housing was being used by traveling staff during an early November interview. The hospital adapted some homes to hold more people, by doing things like taking a four-bedroom home and putting locks on each of the bedroom doors to give four people secure space and shared common areas like the kitchen and living room.

The inability to find and house staff has led the hospital to cap admissions to its nursing homes and cut some of the services it offers.

“We just don’t have enough staff to take on more residents,” Powell said.

The workforce shortage extends beyond clinical staff. With the crunch in the workforce across the state and country leading some employers to offer higher pay, non-clinic staff can now make as much money at a convenience store or hotel instead of the highly-regulated and stressful world of the hospital, Powell said. For those workers, Powell said the hospital offers sign-on bonuses, some relocation expenses and retention bonuses.

While it doesn’t address the housing issue directly, the hospital has several grow-your-own options to help increase its workforce with locals, like offering tuition reimbursement for those going into health care or looking to advance their current nursing certifications.

Governor's program

While the state has a massive influx of cash from the federal government meant to offset the effects of COVID-19, Rasmussen said that money has come with such strict parameters that there aren't options to use it to help with hospital workforce housing.

A $4.3 million program recommended by one of the state’s commissions deciding how to spend money from the American Rescue Plan Act and approved by Gov. Greg Gianforte offers $12,500 relocation bonuses to any out-of-state health care worker that moves to Montana for at least a year.

Powell was hopeful the program would incentivize people to come to the state. The state's ARPA director said the program has funding to cover at least 238 relocations. The structure of the program is still being finalized, said Jessica Nelson, public information officer with the Montana Department of Labor and Industry, and is expected to be running next month.

“If you have somebody that’s moving across the country to make the same wage but you can make that move essentially free for them, that’ll bring some individuals in,” Powell said. “It would take one to take advantage of it to say the program is working.”

Rasmussen called the program “significant.” Montana doesn’t have the ability to fill its workforce needs, he said, because it doesn’t have the capacity to meet the demand. He said there are about 2,000 vacant nursing positions in the state and not enough students coming out of school to fill those jobs. 

A recent report from the state labor department shows that retirements, increased health care demand and the COVID-19 pandemic have led to an incredibly tight labor market for skilled nurses.

ARPA

The American Rescue Plan Act Economic Transformation, Stabilization and Workforce Development Advisory Commission meets inside the state Capitol in mid-August.

“We don’t produce enough nurses in Montana,” Rasmussen said. “You combine that with retirements and the only way we can grow our workforce is to recruit folks into the state.”

Hospitals have also made changes to try to retain the workers they already have, Rasmussen said, pointing to things like a $15 minimum wage at Bozeman Health. Hospitals also provide good benefits such as health insurance and retirement and others are looking at child care options as an additional way to attract employees.

Democrats on the ARPA commission were critical of the program to pay relocation costs, saying it prioritized out-of-staters over Montanans.

Vaccine requirements and recruiting

While the status of vaccine requirements for health care workers remains in question as a number of states are challenging those rules in court, the worker-importation program also raises the question of if it incentivizes those opposed to vaccination to move to Montana.

Montana passed a law earlier this year banning even hospitals from requiring employees get any form of vaccine, and it will likely take a court decision to determine how that law interplays with federal mandates.

There's also a federal rule from the Centers for Medicare and Medicaid requiring any facility that gets federal funding like hospitals to vaccinate employees. Several of the state's larger hospitals have said they're proceeding with plans to vaccinate all employees.

In early November, Powell interviewed a physician who was no longer employed at his former facility because it had a vaccine mandate that took effect Oct. 31 and the physician was looking specifically at coming to Montana. Still, Powell worried if he’d be able to retain that potential new employee if the a vaccine mandate reached Montana.

Such a requirement would “absolutely” further impede staffing efforts for the Glendive hospital, he said.

Pfizer-BioNTech COVID-19 vaccine

Ingrid Radke, a critical care nurse in the ICU, receives the Pfizer-BioNTech COVID-19 vaccination Dec. 16, 2020, at St. Peter's Health in Helena.

“You look at the vaccine rate in health care facilities in eastern Montana and the eastern Montana community in general, we have a fairly low vaccination rate,” Powell said.

“If a mandate like that went through … it’d be significant for our facility,” Powell said. He predicted the hospital would shut down some services if enough employees said they wouldn’t get the vaccine.

In discussing vaccinations and the hospital’s workforce, Powell pointed out the same workers were asked to care for COVID-19 patients before a vaccine was available using proper personal protective equipment.

“We currently have staff right now that aren’t vaccinated that are working on the frontlines of patient care. We treat them all the same. What we’re looking at is making sure if you’re vaccinated or not, that we’re wearing the proper personal protective equipment. What we’re trying to do is keep our staff safe as they take care of the COVID-positive patients,” Powell said. “If you’re vaccinated that’s going to increase your chance of not getting it. But if you’re not vaccinated, even before the vaccines came out and no one was vaccinated, if you had the proper PPE on you’re fine.”

What's next

Even when the pandemic subsides, staffing will be a challenge for years to come, Powell said.

“We’ve actually seen some early retirements, people close to retirement say ‘I’m getting out of this, this is too much,’” Powell said. “If that mandate goes through, we’ll see even more of that as well.”

While filling all of the hospital’s positions is the goal, Powell isn’t optimistic that’ll ever happen. Traveling staff costs more than full-time employees, providing a significant challenge for the hospitals' budget.

“I think the need’s so great out there and a lot of people travel just because they can pick where they want to work. There’s a lot more people moving into those travel agencies,” Powell said.

While facilities have gotten creative in their approach to the housing problem, Rasmussen said the best option is for hospitals to work with outside organizations on the problem. He pointed to partnerships with state and local governments or financial organizations to build new housing.

“Many hospitals have land that has been donated to them. The ability to invest in the conversion of that land into housing is where hospitals need help, particularly in our smallest communities,” Rasmussen said. He pointed to Cut Bank, where the hospital owns eight residential lots but would need assistance in converting those to housing. 

MHA has had recent conversations with a large-scale developer that’s done work in Nevada and the Southeast in an effort to put Montana on their radar screen, Rasmussen said.

“It’s a small critical access hospital that doesn’t have the financial depth to become a developer,” Rasmussen said. “There’s lots of examples of where hospitals have property but it’s putting together the right partnership to convert that into housing.”

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