By Maya Kosoff, Director of Content at Company Ventures (maya@companyventures.co) and Mark Rosenthal, Investment Partner at Company Ventures (mark@companyventures.co).

We spoke with founders in the Company Ventures healthcare portfolio to understand the nature of the healthcare burnout crisis and the scale of the opportunity embedded in solving it. 

Executive summary: Through our research, we've identified three main areas of opportunity for fixing America's healthcare burnout crisis:

1. Increasing the supply of healthcare workers. 12% of all Americans work in healthcare, and yet that number is not enough. Data shows that the healthcare industry in particular has not fully recovered from Covid with nursing care and elder care most affected. We need new tooling to attract and (re)credential talent for work in the healthcare sector – good paying jobs that can help families enter the middle class. 

2. Improving the mobility and efficiency of the existing healthcare workforce. In 2023, healthcare organizations are expected to spend over $55 billion on hiring temporary clinical workers, and the whole market has grown at a 24% CAGR over the past 5 years. New technology enabling healthcare provider groups to improve care operations like Reverence contribute to 80%+ time savings for schedulers; a 1.5-2x staff retention improvement; direct revenue increases; and client satisfaction boosts.

3. Leveraging AI and automation generally to drive satisfaction into physicians' and healthcare workers' jobs. Annually, a doctor spends an average of 110 hours addressing patient questions about routine lab results. This translates to a $33 billion loss in clinical productivity across the US medical system. By turning health data into actionable insights and giving patients clarity about what their results mean and what they need to do next, clinical co-pilots like Elaborate eliminate 35% of a doctor's administrative load, increasing billable referrals by 5%.

Just past the three-year anniversary of the start of the COVID-19 pandemic, healthcare workers are burning out at an alarming rate. In May 2022, United States Surgeon General Dr. Vivek Murthy issued a Surgeon General’s Advisory highlighting the urgent need to address the health worker burnout crisis across the country, and projecting a shortage of more than 3 million essential low-wage health workers in the next five years and a projected shortage of nearly 140,000 physicians in the next decade. According to one study in Mayo Clinic Proceedings, more than 3 in 5 physicians reported at least one symptom of burnout in 2021. Although burnout has been exacerbated since 2020, it has been around even before that—and it’s affecting non-physician healthcare workers, too. In 2021 alone, almost two-thirds of nurses (62%) reported experiencing burnout.

This is a non-trivial matter. From infants to seniors, America is facing a mortality crisis. US life expectancy is in freefall: In December, federal health officials confirmed American life expectancy had dropped for a nearly unprecedented second year in a row, down to 76 years. While countries around the world saw life expectancies rebound during the second year of the pandemic after the arrival of vaccines, the US did not. US maternal mortality reached a high in 2021, and a paper in the Journal of the American Medical Association found rising mortality rates among U.S. children and adolescents. DATA. This is a function of a number of inputs (deteriorating nutrition, obesity, opioid and fentanyl crises, etc.), but a well functioning healthcare system will be necessary to stem the tide, if not keep from contributing to the crisis itself.

The reasons are apparent to anyone who practices medicine today: ever-increasing administrative burdens and hassles, inadequate support in practices and health systems to mitigate these obstacles, deliberate disinformation campaigns plaguing public health efforts, political attacks on medical science, and third-party interference in the patient-physician relationship. We need to fix what’s broken in healthcare today—and it’s not the medical staffer. But how do you restabilize a complex system like healthcare even as it constantly continues to experience stressors?

How do you solve a problem like healthcare worker staffing issues?

One big area to tackle, founders working on the frontier of healthcare and technology say, are resolving issues related to staffing in healthcare. “The fact that there are not enough people to care for all of the patients that are requiring care at the moment means that more of the burden falls onto fewer people—so everyone's carrying a heavier load, and that's always hard,” says Alexander Nazem, the co-founder and CEO of Nomad Health, a digital marketplace for travel nursing and healthcare staffing. “So if there's any way to alleviate that burden, by finding other ways to amplify the staff that we do have and unload them a little bit, that would be very valuable.”

Nomad Health co-founder and CEO Alexander Nazem

Nazem, who was a practicing physician for a decade prior to launching Nomad Health, cautions that we are still in the middle of healthcare worker burnout being prevalent—and that it’s “far from a well-addressed problem.” But one possible remedy, he says, is something Nomad is working on: flexible work. “One of the top reasons for taking flexible jobs is to address workers’ burnout or concern about becoming burned out,” he says.

Increasing the pipeline for new healthcare workers is a longer-term solution to the burnout crisis. In January, Congress expanded the number of residency slots for medical students for only the second time in 25 years, approving an additional 200 slots for 2023. The Centers for Medicare & Medicaid Services’ Fiscal Year 2022 Inpatient Prospective Payment System final rule established policies to implement 1,000 new Medicare-funded physician residency slots to qualifying hospitals, phasing in 200 new slots every year over the next five years. This is progress, but still leaves the U.S. healthcare system in a deficit—it’s projected we’ll still be short 124,000 physicians by 2034. It’s an issue that’s top of mind for Carl Madi, the co-founder and CEO of Stepful, which offers healthcare worker training programs designed to fill vacancies quickly, make career advancement training accessible for all employees, and reduce hiring costs. “When you have nurses that need to take on multiple shifts or healthcare professionals that need to take multiple shifts, they tend to burn out and not be able to treat as many patients as you want — and the quality of the outcome is not there,” he says. Demand for talent in healthcare now vastly outpaces the amount of healthcare talent that exists—so companies like Stepful are thinking about how to efficiently create supply.

There are around 37 million Americans that have a high school diploma and are low-wage workers, and there are several million projected job openings in healthcare that likely won’t be filled. Stepful wants to fill that gap. “When you dig deeper, you understand that there are a couple of things at play. One: People are not aware of a lot of careers in healthcare.

Stepful co-founder and CEO Carl Madi

So if I ask you what a phlebotomist does, most people do not know. So there's a lack of awareness for these careers. Second, even if they're aware of these careers, training is expensive, and it takes one to two years,” Madi says. “So for someone who is a mother, who's working at Starbucks, she's not able to take care of her child, work, and then study and get upskilled. So it's expensive. It's risky, it takes time.” Stepful brings down the cost of training—instead of $20,000, it’s $2,000, and instead of two years, workers can get trained in four months. “We're making education much more accessible to the people who need it the most,” Madi says. Five million people need healthcare training annually, and healthcare worker trainees using programs like Stepful increase their salaries between 25% to 40% after completing upskilling training.

Finding efficiencies in the system’s complexity 

Winnowing down the amount of time healthcare workers spend on everything but caring for patients would also help alleviate rampant burnout, founders say. “Things that are extremely administratively complex—you’re spending more time tending to that and less and less time caring for patients, which is what drew most clinicians into the healthcare space initially,” Nomad Health’s Nazem says. 

A recent article found that a healthcare practitioner receiving more than the average number of inbound messages on a daily basis is associated with a 40% higher probability of a doctor burning out, and a 38% higher probability of them actually reducing their clinical time. 

Despite concerns about doctors’ workloads associated with electronic medical records (EMRs), little attention has been paid to the relationship between their well-being and the in-basket messages they receive as tech platforms proliferate. Research has found that time spent by physicians on the EMR has been linked to reduced satisfaction with their work. Doctors are spending more time answering messages in part because of a piece of legislation called the 21st Century Cures Act, which requires doctors to directly release most non-sensitive results to patients immediately. Patients receive their results with no context from a doctor or clinical acumen and turn to Google. “And so they start diagnosing themselves with an autoimmune condition, or some crazy blood disorder that's likely irrelevant for them,” Nicole Bocskocsky, the founder and CEO of Elaborate, says. “They then pick up the phone or message their doctor asking questions. And they are panicked, they're expecting immediate responses. They're super frustrated if the response is short.” But on the flip side, even when a doctor is providing a quick, short response, they and their staff are spending 20 or 30 minutes responding to these messages and answering the same questions over and over again. “That is the definition of insanity,” Bocskocsky says. “Doctors did not go to medical school to copy-paste the same thing over and over again.” 

The intent behind the Cures Act is the right one—you want to give consumers the ability to have more direct ownership over their health. “But there's no way for doctors today to implement a solution to this that both respects the law and also maintains reasonable standards for their clinicians, outside of Elaborate,” Bocskocsky adds. Elaborate acts in service of the doctor in delivering this care to their patients, by providing contextualized health data for EMRs and allowing doctors to deliver clear, action-oriented communications to their patients. What that does for doctors is it effectively eliminates much of the back-and-forth communication with patience, reducing their in-basket and the messaging they have to do by 30 to 35%.

Elaborate founder and CEO Nicole Bocskocsky

"When you ask yourself the question, can I see myself doing this job in 10 years, you think about why you got into that profession in the first place. In my experience, when you talk to medical staff, what they say got them into medicine is the interactions with patients that bring them joy and energy," Bocskocsky says. "Transactional, random, annoying administrative tasks that create a sense of never-ending burden and headache get in the way of this joy. And as a result, have an outsized and detrimental impact on a human being’s ability to foresee themselves being happy in that career long term." 

It’s not just about pay—it’s about working conditions, too

In January, ​​more than 7,000 nurses at two major New York City hospitals walked off the job, arguing immense staffing shortages are causing widespread burnout and hindering their ability to properly care for their patients. This strike was not an isolated incident—it was just the latest in a series of strikes in the healthcare industry in recent years. Those union members who were on the front lines during the now three-year battle with the COVID pandemic say the system is no longer able to function with the widespread shortages that arose during those years. Four out of the 20 strikes reported by the Labor Department last year involved nurses unions. The largest was a three-day strike by the 15,000 members of the Minnesota Nurses Association, involving 13 hospitals in the state.

The key points of negotiation with the striking union in New York City and the health system that they were contracting with wasn't about pay—it was actually about nurse-to-patient staffing ratios. The health system had already proposed some pretty substantial wage hikes—19%, over three years, a meaningful increase. “On almost any other labor negotiation, that would be more than a winning bid. But the issue was not about paying people more, it was more about changing the working conditions. And so in that regard, it is pretty directly correlated to the burnout conversation,” Nomad Health’s Nazem says. 

Typically, nurse strikes are about how exhausting and how repetitive and how busy their jobs are. Stepful’s Madi says that access to technology to improve their work situations is core to solving these problems, and keeping nurses from being overworked. “Building the tools and the technology for them to be able to do their jobs, for them to get more staff, for them to have access to technology to improve their access to education, and increasing opportunities for them to grow. I think these are all very important to prevent more unhappiness, more strikes, and more burnout,” he says.

How tech can help address these issues

For Nomad’s Nazem, what matters most is giving healthcare workers reason to believe in the importance of their jobs again. “Happiness is not defined by the lack of unhappiness—there actually has to be a reason that you are excited about what you're doing. And yes, it's important to eliminate some of the unhappiness, which for clinicians involves stuff like more staff and reduced admin,” he says. “But there is also something that needs to be restored about the nobility of the practice of medicine. And I think over the last  decade, that has slowly been seeping out of the system.”

The burden of physician burnout did not grow to its current proportion overnight, nor will it disappear entirely tomorrow. But recognizing its severity, and taking bold action to limit its impact, are important steps in restoring joy to the profession and making it a sustainable career for more doctors and nurses. Startups are stepping up to do the difficult work to alleviate the pressure on physicians, renew the profession for the next generation, and create a health system that works for patients. “When we think about technology being able to truly empower physicians and enable them to prosper, that's where we actually can have an outsized impact,” Bocskocsky says.