ICYMI: Increasing Nursing Home Staffing Minimums Estimated at $10 Billion Annually

The American Health Care Association (AHCA) released a new report from accounting and consulting firm CLA (CliftonLarsonAllen LLP), which found that increasing staffing minimums at the federal level will require billions of dollars each year to hire tens of thousands of more caregivers. CLA estimated the impact of implementing a staffing minimum of 4.1 hours per resident day (HPRD) and concluded:

  • 94 percent of nursing homes that care for more than 900,000 residents would need to increase staffing levels in order to be in compliance with such a requirement.
  • It would cost $10 billion a year and require hiring more than 187,000 nurses and nurse aides to meet the standard.
  • 18 percent of residents, or more than 205,000 residents, may be at risk of displacement as facilities are forced to potentially reduce their census in order to meet the higher staffing standard.

“This report makes it crystal clear that increasing staffing standards in nursing homes requires substantial and consistent government resources. Even then, nursing homes would have the impossible task of finding another 187,000 nurses at a time when vacant positions sit open without applicants for months on end. The unintended consequences of this sort of unfunded mandate would be devastating to hundreds of thousands of vulnerable residents who could be forced out of their nursing home,” said Mark Parkinson, president & CEO of AHCA.

The CLA report models three different minimum staffing requirement scenarios to estimate the additional staff necessary as well as the costs associated. The 4.1 HPRD model (Scenario 1) is frequently referenced by industry stakeholders due to a 2001 study evaluating staffing levels in nursing homes.

“Every staffing minimum scenario we analyzed found that tens of thousands of additional full-time employees as well as billions of dollars each year would be necessary in order for nursing homes to be in compliance,” said Deb Emerson, Principal at CLA. “Many facilities will have to make difficult decisions, such as reducing census, to meet the proposed staffing minimums.”

The Biden Administration has proposed establishing a minimum nursing home staffing requirement without corresponding resources despite the industry already facing a historic staffing crisis due to the pandemic and a nationwide nursing shortage. Over the course of the pandemic, nursing homes have disproportionally lost more workers than any other health care sector—over 200,000. As a result, more than 6 in 10 nursing homes say they must limit new patient admissions, and nearly three-quarters are concerned their facility may have to close entirely due to staffing shortages.

“Every nursing home wants to hire and develop more caregivers, but they can’t do it alone. An enforcement approach will not solve this long term care labor crisis. We urge the Administration and Congress to put forth meaningful aid and policies that will help us recruit and retain the dedicated caregivers our nation’s seniors deserve,” said Holly Harmon, RN, AHCA’s senior vice president of quality, regulatory and clinical services.

AHCA has been calling on state and federal policymakers to help address the labor shortage by directing resources to long term care, so nursing homes can offer more competitive wages and benefits to frontline caregivers, as well as establishing policies that will help nursing homes recruit and retain caregivers. The comprehensive approach can be found in AHCA’s Care For Our Seniors Act and includes proposals such as loan forgiveness, tax credits, affordable housing, childcare assistance, and immigration reform.

View the CLA report HERE.

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