How to Create a Great Workplace in Health Care by Ed Frauenheim @FortuneMagazine April 12, 2016, 10:06 AM EDT E-mail Tweet Facebook Linkedin Share icons When employees at Martin’s Point Health Care catch a coworker doing a good deed, they give them a card with a picture of a kitten on it. What started out as a joke has turned into a badge of honor at the Maine health care and insurance provider. Employees who get a Kitten Card sign it and then pay it forward by giving it to another colleague living out one of Martin’s Point four main customer service promises. Once a quarter, everyone who’s received a card is put into a drawing to attend a Kitten Lunch with the nonprofit’s executive management team. At the lunch, people share stories and walk out holding their heads a little higher. “It is not uncommon to hear people citing the values in everyday conversation,” one Martin’s Point employee says. “It’s like second nature. The work may be hard at times, but most every day we leave with a feeling we did important work that helped our patients, community and each other.” Challenges facing the health care industry are the opposite of kitten playful. Yet some organizations have created workplaces that employees say make them feel close to their coworkers and proud of what they do, despite tough times. A spirit of camaraderie, pride and fairness is apparent throughout companies in the 20 Best Workplaces in Health Care for 2016, announced today by Great Place to Work and Fortune. And these organizations with healthy cultures also benefit from competitive advantages in the health care talent wars. Texas Health Resources is No. 1 on the list, followed by Encompass Home Health and Hospice at No. 2 and Preferred Home Health Care & Nursing Services at No 3. Martin’s Point appears at No. 5 on the list, which includes hospital systems, home health care providers, national health care associations, and medical products distributors. Great health-care workplaces aren’t limited to big organizations. Employers on the list have as few as 167 workers, and as many as 19,152. Health Care Industry Pressures For health care organizations big and small, the industry is changing. Organizations in the field are under intense pressure to curb costs brought on by an influx of new patients covered by the Affordable Care Act and the aging population. Competition is pushing more health care organizations into mergers and acquisitions. Health care organization must keep up with technology innovations affecting everything from where they treat patients to how they keep medical data secure. At the same time, health care companies can’t fill jobs fast enough. From 2000 to 2010, industry jobs grew 25%, more than twice as fast as the rest of the economy, according to research by the University of Albany. By 2020, the health care industry is expected to add another 4.2 million new positions. The labor crunch is especially noticeable in nursing, where nearly half of U.S. RNs are expected to reach traditional retirement age by the end of the decade. Despite directives to be cost effective and do more with less, employees at the best health care organizations remain gung ho about work. They can’t wait to show up in the morning, feel valued for their contributions, and enjoy a work atmosphere that’s encouraging and respectful. “They’re working in a family-like atmosphere where everyone’s in their corner and has a common goal of taking care of people and saving lives,” says Hannah Elise Jones, a Great Place to Work consultant. Like Part of the Family Health care institutions are hierarchical by nature, and at some workgroups must compete against each other for limited resources. At the best workplaces, though, coworkers say they feel like a cohesive unit, no matter what their job. The vast majority of employees say their workplace is “friendly,” feel like an equal member of the organization regardless of their position, and say they can count on coworkers to cooperate. “If you’re on your feet all day, it’s tough and emotional, one thing that can get you through the day is an emotionally supportive workplace,” Jones says. At Texas Health Resources, a nonprofit with 24 hospitals in Dallas and Ft. Worth, that friendliness extends to new employees. During their first year on the job, new hires wear a special badge that flags coworkers to introduce themselves, explain policies, and offer other help. At Southern Ohio Medical Center, a 233-bed hospital and No. 4 on the Best Workplaces in Health Care list, each department has a person or team responsible for cultivating relationships by planning staff celebrations for birthdays or work anniversaries, and organizing fun events such as bowling and pool parties. Baptist Health South Florida (No. 6) offers interest-free loans to workers facing a financial crisis because of a fire or other emergency, and puts up $2 for every $1 employees raise. Good for the Bottom Line Creating a supportive, family-like atmosphere isn’t just good for employees, it’s good for the bottom line. It’s expensive to replace people due to the hiring and training costs involved. But as the U.S. jobless rate stays under 5% and openings remain plentiful, employers are seeing an uptick in employees quitting for new opportunities. It’s especially true in health care, where voluntary turnover hit 14.4% in 2015, from 13.1% the previous year, according to Compdata Surveys. Best workplaces, by contrast, do a better job of retaining workers. Dallas-based Encompass Home Health and Hospice is one. The $369 million HealthSouth subsidiary manages a workforce of 8,140 nurses, therapists and other clinicians who care for more than 65,000 patients. In the past year, voluntary turnover for Encompass’ full-time employees was 10%. At Martin’s Point, which has 808 employees at multiple offices in Maine and New Hampshire, turnover in the past year was even lower, 7%. The friendly, family feel that permeates great workplaces also makes it easier to recruit employees. At many best health care employers, staff are a major source of referrals. In the past year, employee referrals accounted for 36% of new hires at Encompass, 25% at Martin’s Point, and 17% at Texas Health Resources, which pays $3,000 bonuses when a candidate an employee recommends for an eligible position gets the job. Pride in Their Work As might be expected of people with jobs helping others, employees at best workplaces for health care are satisfied and proud of what they do. Close to nine in 10 say their work has a special meaning and isn’t just a “job.” That’s even better than the response from people at companies on the broader ranking of Fortune‘s 100 Best Companies to Work For. In addition, more than 93% feel proud to say where they work. Employees’ pride in their work is critical to health-care companies’ culture and success, says Jones. “No matter what else might be going on in their business or their culture, pride typically remains a strength. The best workplaces in this industry set themselves apart by leveraging that pride to enhance employee engagement in other areas.” An equal number of employees at great workplace companies are proud of the ways they contribute to the community. At No. 19 Cottage Health, a nonprofit health care provider in central California, one source of that good feeling about giving back to the community is an annual remembrance event the company hosts for relatives of patients who have died. The hospital also offers a closure ceremony for families after a patient dies in an acute care setting. A group of Cottage bedside nurses and the nonprofit’s research team developed the ceremony, which received an innovation award from the Hospital Association of Southern California. The innovations are examples of how Cottage employees and managers regularly work together to solve problems and improve processes. Employees point to this shared-governance management style as one reason the health care provider is a great place to work. “Some hospital organizations use shared governance in their nursing departments, but we’re one of the only organizations in the country to use it throughout the entire organization,” one employee says. “Way to go, Cottage!” Ed Frauenheim and Tabitha Russell are director of research and content, and recognition program manager, respectively, at Great Place to Work, the longtime research partner for Fortune’s annual list of the 100 Best Companies to Work For and other best workplaces lists, including the 20 Best Workplaces for Health Care.