Richland Health has three hospitals in the greater Tampa, Florida area. Demand for patient services varies considerably during the fall and winter months due to the temporary influx of the aged population. From October through March, providing adequate nursing staff is extremely difficult for Richland Health.
Last year, to address this problem, Richland Health contracted with Cross Country TravCorp to hire traveling nurses during these 6 months. TravCorp offered to provide nurses under the following four contract options:
Option Length of Employment Cost
1 One Month $5,000
2 Two Months $11,600
3 Three Months $17,000
4 Four Months $24,000
Longer contract periods are more expensive because fewer nurses are willing to commit to longer work assignments. During the next six months, Richland has projected the following needs for additional nurses.
Download the Assignment 3 Template – Fall 2016.xlsx worksheet for this exercise.
Each month, Richland can hire as many nurses as needed under each of the four options. For instance, if Richland hires five nurses in October under Option 2, Cross Country TravCorp will supply Richland with five traveling nurses who will work two months: October and November. For this, Davis must pay 5($11,600) = $58,000. Richland Health does not want to commit to any contractual obligations for traveling nurses beyond March. No traveling nurses should be employed past March.
Each nurse hired in the traveling-nurse program must receive training at the time of hire, at a cost to Richland Health of $1750 per hire, regardless of the option under which the nurse is hired. The training program is required even if the person has worked for Richland Health in the past.
Richland Health needs to know how many traveling nurses to hire in each of the 6 months under each of the 4 contract options so that it can at least meet its projected demand in each month
Assume your manager has given you this task and you need to come up with a solution. Use the first worksheet, denoted Part 1, to determine a feasible solution that meets monthly staffing needs. You will likely use trial-and-error. USE THIS WORKSHEET – DO NOT CREATE YOUR OWN. Try to come up with the best solution that you can – meaning one with the least cost.