According to one web site the nerve has to heal on its own and only time will tell if it will:
Nerves are notoriously slow healers. It has been said that a good 6 months must pass before one can say the maximum recovery has occurred and no more positive progress can be expected. Most cats who are going to recovery function do so in a one week period and most cats who do not recover urinary control after a month probably will remain incontinent. Tail function and sensation tends to take longer.
However, it also noted that is is possile for you to express the bladder yourself at home, your vet can show you how.
Management of the Bladder
It is important not to allow the bladder to over-stretch. The fine muscles of the bladder can become so stretched out that even if the nerves recover, the bladder may still remain unable to empty fully. This means the cat's bladder must be gently squeezed 3 or 4 times daily to keep it from over-distending. Medications can also be used to assist the bladder's own ability to contract (Urecholine®) or to relax the urinary sphincter (diazepam or phenoxybenzamine). Since urine retention tends to promote infection, patients will periodically require some sort of monitoring urine tests. If constipation is a problem, periodic enemas or regular administration of stool softening medications can be given.
Whether, you bring the cat home now or not depends on whether you will be able to provide him with the care he needs and be able to express his bladder as needed. Because of so serious and injury you'll have to decide whether you and your family can cope with this problem if he does not heal from the damage. If so, then take that kitty home and nurse him back to health. But if you know that you and your family cannot give him the time he would need to deal with this problem then you can talk to your vet about what your options are and what his prognosis for the future is.
Hope this helps!