Comparison of growth in compensation for hospital administrators and nurses in Kansas, 2003 to 2005

The current nursing shortage is reaching a critical level (Buerhaus, Donelan, Ulrich, Norman, & Dittus, 2006). As baby boomers reach an age when they will require increased healthcare the demand for nurses will accelerate over the foreseeable future. One issue impacting the desirability of nursing as a career is salary compensation. Nurse salaries have not kept up with the rate of inflation (American Association of State Colleges and Universities, 2005) while hospital Chief Executive Officer (CEO) compensation has increased (Westfall, 2005). The purpose of this study was to examine the compensation growth of hospital CEO's compared to nurses over the past three years in Kansas. Hospital CEO data was obtained from the Internal Revenue Service form 990 retrieved from the public domain. Nursing salary data was obtained from archival data published by the Kansas Department of Labor Statistics. Data analyses described differences in the salaries of nurses and chief executive officers in Kansas over a three-year period and within subgroups defined by geographical region. During this three year period Kansas hospital CEOs' compensation increased 23.2% compared to a national increase of 9%. Registered Nurses' compensation in Kansas increased 17.39% compared to a national average of 11%. Licensed Practical Nurse compensation in Kansas increased 6.28% compared to a national average of 9%. The population in the United States is growing older at the same time demand for nurses will accelerate (Lovell, 2006). The shortage of nurses is reaching a critical level as hospitals try to provide care. Causes of the shortage are multifaceted and include the demand for nurses outpacing supply and compensation trends. In Kansas, the supply of nurses is hampered by a present shortage of nursing faculty that will be exacerbated by the impending retirement of a sizable portion of the faculty in the next decade (Hornberger, Hess, & Thompson, 2005). The lack of faculty impairs nursing programs' ability to expand enrollments to produce adequate numbers of new nurse graduates (Bliss, Valiga, & Novak, 2004). With an insufficient supply of future graduates, hospitals--which employ 60 percent of all nurses--face the immediate problem of filling enough positions to provide adequate care to patients (Cohen, 2006). In spite of this shortage, salaries have not risen substantially over the past several years, and real wages, when adjusted for inflation, have actually declined (Lovell).