The nursing shortage is not easing. The Bureau of Labor Statistics projects more than 193,000 registered nurse openings per year through 2032, and HRSA projects a shortfall of over 500,000 RNs by 2030. Filling shifts is not a workforce strategy. Neither is defaulting to whatever model your staffing agency prefers.

PRN, per diem, and travel nursing serve different functions. They have different cost structures, risk profiles, and trade-offs in care continuity. Using them interchangeably is one of the more expensive habits in healthcare operations.

The cost picture

Travel nursing is the most expensive model on a per-shift basis, and the bill rate understates the real cost.

Travel nurses earn roughly 27% more than permanent staff on a per-hour basis, with agency markup compounding on top. The visible line items are the contract rate and that markup. The ones that rarely appear in an RFP comparison are orientation time, housing stipends, and the fixed contract obligation that keeps running when census drops.

Rates fell sharply from their pandemic peak. The average U.S. travel nurse earns just under $2,300 a week in 2025, down 42% from nearly $4,000 at the peak. Staffing Industry Analysts reported that total travel nurse revenue dropped 37% in 2024 alone. “Down from the peak” still means the most expensive contingent model in your toolkit.

PRN nurses often earn a higher hourly rate than travel nurses. The PRN premium exists because the role comes without benefits: no housing, no stipends, no orientation budget. You are also not locked into a 13-week contract, and the clinician already knows your facility.

Per diem lands between the two on total cost. Hourly rates run above staff nurse rates, but without agency markup or long-term obligation when you source through a direct marketplace.

Comparing the models

When to use each model

PRN: predictable internal gaps

PRN is the lowest-friction option when you need coverage from someone who already knows your EMR, your protocols, and your unit: no onboarding lag, no orientation cost, no agency relationship.

The ceiling is your internal pool. When gaps outpace what your employed float can absorb, you need external supply. And there is a hard financial case for exhausting PRN capacity before you reach for outside labor. Agency nurse use in U.S. hospitals increased 133% between 2019 and 2022, driving a 260% increase in total agency labor costs, according to research in The Journal of Healthcare Leadership. Facilities that let their float pools erode during that period paid for it for years.

Per diem: surge coverage and unplanned gaps

Per diem gives you external supply with no multi-week commitment. A clinician picks up a shift, you fill the gap, and neither party carries a contract obligation into the following week. For census swings, seasonal callouts, and short-term volume spikes, it is the most cost-efficient external option.

The shift toward per diem is already underway. Staffing Industry Analysts projected that per diem staffing companies would reach $5.7 billion in revenue in 2025, with 41% of firms expecting order volume to increase. Facilities with established per diem pipelines fill gaps in hours. Those without one call a travel agency.

Travel nursing: extended specialty gaps

Travel is the right tool for a certified scrub tech, new service line needs, an ICU nurse covering a vacancy while you recruit, or a specialist in a market where local supply does not exist. Demand for experienced nurses remains concentrated in high-acuity specialties: ICU, ER, OR, and labor and delivery, exactly the roles that are hardest to fill locally and fastest to justify a contract.

The error most facilities make is treating travel nurses as a default gap-filler. A 13-week contract on a med-surg shift that per diem could fill in 48 hours is a labor variance waiting to appear in your quarterly review.

Where the market is moving

Facilities that over-indexed on travel nursing between 2020 and 2022 are pulling back.

“The directive broadly in nursing, because of the skyrocketed labor costs, is to get rid of travelers,” said Katie Boston-Leary, SVP at the American Nurses Enterprise. “That’s why per diem becomes that option for a number of folks.”

A 2024 survey from Incredible Health found that 67% of health executives did not increase travel nurse positions that year, and nurse interest in travel work dropped 22%. Facilities are contracting their travel spend. Clinicians are choosing flexibility over contracts. The correction toward per diem reflects cost pressure from both sides of the market.

Building a staffing mix that holds

A tiered approach is the most defensible labor strategy:

1. Core employed staff for stable, recurring demand
2. PRN / internal float pool for predictable fluctuations
3. Per diem for on-demand surge and unplanned gaps
4. Travel nurses for extended specialty shortages only

The cost of getting the mix wrong compounds quickly. Replacing a single RN runs between $49,500 and $72,700 in recruiting, training, and lost productivity. Over-reliance on any one contingent layer drives turnover, inflates your labor line, and weakens care continuity. Each tier serves a specific function; the goal is to match the right model to the right gap, not defaulting to whatever is easiest to procure.

Fill gaps without the agency markup

Medely is built around the same tiered logic this article describes. Talent Fusion Core manages your internal resource pool, so every shift requisition starts by exhausting your employed float before touching external supply. When internal capacity runs out, Medely’s waterfall routing automatically moves to Medely’s per diem marketplace, matching per diem clinicians by unit, credentials, availability, and cost. Agencies only enter the picture if the shift goes unmet at every prior layer.

Most facilities that default to agencies are skipping the two most cost-effective steps; Medely automatically puts them first to save you time and money.

See how Medely works →