The Need for an Economically Feasible Nursing Home Staffing Regulation: Evaluating an Acuity-Based Nursing Staff Benchmark

Abstract

Background and Objectives Despite concerns about the adequacy of nursing home (NH) staffing, the federal agency responsible for NH certification and regulation has never adopted an explicit quantitative nursing staff standard. Harrington and colleagues (2020) have proposed a benchmark for this purpose based on the 1995/97 Staff Time Measurement (STM) studies. This paper aims to assess the extent to which NHs staff to this proposed STM benchmark, the extent to which regulators already implicitly apply the STM benchmark, and compute the additional operating expenses NHs would incur to adhere to the STM benchmark. Research Design and Methods Using NH Compare Archive data, the STM benchmark was compared to staffing levels reported by the facility and whether NHs received a nursing staff deficiency. Using financial information from Medicare Cost Reports, the additional annual operating expenses required to staff to the STM benchmark were calculated for each state and nationwide. Results The vast majority of NHs did not staff to the STM benchmark; 80.2% for registered nurses and 60.0% for total nursing staff. Deficiency patterns showed that NH regulators were not using the STM benchmark to determine sufficiency of nursing staff. Implementing the STM benchmark as a regulatory standard would increase operating expenses for 59.1% of NHs, at an average annual cost of half million dollars per facility. The nationwide increase in operating expense is estimated to be at least$4.9 billion per year. Discussion and Implications Without clear guidance on the staffing level needed to be sufficiently staffed, most NHs are subject to a community standard of care, which some have argued could be associated with suboptimal staffing levels. Implementing an acuity-based benchmark could result in improved staffing levels, but also comes with significant economic costs. The STM benchmark is not economically feasible at current Medicare and Medicaid reimbursement levels.

Nursing home finances associated with real estate investment trust and private equity investments

“…33 Importantly, previous research has associated staffing levels with NH quality. 2 , 28 , 34-38 The REIT NHs had higher wages, which may result from improved financial position associated with REIT investment. The PE-invested NHs had lower wages, which may result from efforts to reduce expenses and potentially improve efficiencies.…”

“…Wage costs were measured with total nursing and total wages, both PRD. Clinical nursing variables measure NH investment in direct patient care staffing, 28 an area receiving much attention from CMS, including a recently proposed rule to increase national minimum staffing requirements. 29 Total wages, comprising the largest of NH expenses (>40% in 2019), 21 measures the proportion of spending on wages.…”

Evidence Base for the Future of Nursing Homes: Special Issue

“…Although a standard for nursing staff adequacy has never been set by regulators, researchers have built up alternative staffing standards from hours of care associated with various resident need characteristics, and the current administration appears ready to codify such a standard ( White House, 2022 ). The article by Bowblis (2022) points out that the majority of U.S. nursing homes staff below and even well below one likely case mix-based staffing standard, and that bringing all nursing homes up to this hypothetical standard would have immense cost, even at current low wage rates.…”

“…Quality in the nursing home setting is multidimensional, and the articles address quality in several ways. Three articles ( Bowblis, 2022 ; Kishida, 2022 ; Sharma & Xu, 2022 ) focus on adequacy and stability of staffing, a basic requirement for structural quality. Another group ( Carnahan et al, 2022 ; Cross & Adler-Milstein, 2022 ; Davitt & Brown, 2022 ; Hass et al, 2022 ; Ninteau & Bishop, 2022 ) discuss aspects of clinical care that should be targets for improvement and regulation.…”

United States’ Nursing Home Finances: Spending, Profitability, and Capital Structure

“…9 Other studies show that most NHs failed to meet the CMS 2001 recommended minimum staffing levels in 2019 (4.1 total nurse staffing hours per resident day, including 0.75 RN hours per resident day 10 ) and staffing levels recommended by experts based on acuity in 2017. 11,12 In addition to putting residents at risk, heavy workloads, low wages and benefits, and poor working conditions have been associated with persistent staff dissatisfaction, shortages, and high staff turnover levels. 7,13,14 NHs are primarily funded by the government (59% 15 ), including Medicare, which pays for short-term, rehabilitation care, and Medicaid (funded jointly by the state and federal governments) which pays for long-term care.…”