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UVa Medical Center to spend added $30 million for employee pay

University of Virginia Medical Center officials say they will sink more than $30 million into merit raises and pay increases in the next fiscal year in an effort to reward and retain current employees and improve recruitment of new employees.

The effort comes as nursing and staff shortages affect hospitals and medical facilities nationwide and burnout from 18 months of the COVID-19 pandemic convinces many to leave their professions.

“It’s a pivotal time, and it’s probably the hardest part of the pandemic for health care providers, right now. It’s not just the COVID patients you’re taking care of today; it’s the 18 months you’ve been doing it. The stress is just compounded over time,” said Wendy Horton, UVa Medical Center’s chief executive officer.

Horton said improving compensation is both a reward and an incentive for current employees to stay on the payroll and will help in recruiting others to fill open positions.

“We are committed to achieving a competitive market pay position for our team members and improving our ability to reward, attract and retain our most valuable assets, which are our people,” she said. “For this reason, we have built this commitment into our long-range financial plan.”

Horton said the $30 million will help put UVa in a more competitive position within the marketplace. That, she said, was not always the case.

“Traditionally, and going into COVID, UVa may have been behind the market for some time,” she said. “It’s been a double-edge sword of starting behind the market, COVID exacerbating that and then the market place changing. We have catching up to do. COVID changed the way the industry works and it’s not just health care, it’s many different industries.”

Employees throughout the medical center will receive a merit increase this year, Horton said. About 40% of employees will receive an additional increase to meet the market for their jobs and specialties.

The pay is already built into next year’s budget, Horton said.

“We have a long range financial plan and we’ve baked that compensation into that long range plan that starts in July,” she said. “But we need to do something for our people right away and the question was what do we do from here until July? It’s important to make sure we’re market competitive.”

Officials will review market information early next year to see what changes need to be made.

“In January, we’ll look again to see where we are in the marketplace as there will be refreshed data,” she said. “We’ll see if we have more money and what we can do to move forward. We’re just going to keep at it.”

To find the funds, medical center leaders looked to fund balances and savings generated by recent efficiency moves in the hospital. They also dipped into savings to make a year’s worth of pay.

“It’s coming from multiple sources. There’s a portion of it that’s in the budget and some of it is coming from efficiencies we’ve been able to realize from internal programs and some is coming from short-term reserves to make it all happen,” she said.

Horton said the money was not readily available.

“If we had the money before, we’d have given it. This is possible because people are pulling together and being creative, knowing that our [health care] teams need this at this very important time in our institution,” she said.

“We had to work together as a leadership team. We had only budgeted a portion of that and had to work within the budget, soul search and find it,” she said. “It is a strategic thing. It’s an important time in health care and it’s the right thing to do for our people. These are amazing people. The expertise and longevity of the individuals on our team are creating life-saving miracles every day.”

The UVa Health system is focusing on personnel as health organizations across the country compete for new hires. On Sept. 27, Charles Bodden joined UVa Health as the system’s first senior director for talent acquisition and retention. He is to lead a consolidated recruitment team to attract, hire, promote and retain staff.

Horton said the effort to increase compensation is going to be done over time. The $30 million represents the first effort.

“I believe that the people are the heart and soul of UVa Health and it’s why we do what we do. These teams care for the patients. We have great technology and all of the other things we need, but our people are the ones who provide amazing care and we’re trying to make sure we get that right,” she said.

“We want to recruit and have on board the right people, and that’s hard to do across the country,” she said. “It’s going to take time. I’m not saying this is a silver bullet, but I hope it’s a dose of hope for future.”


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