The Rising Cost and Implications of a Potential Federal Staffing Mandate for Skilled Nursing Facilities
Welcome to our latest article, where we delve into the impact of a potential federal staffing mandate on the skilled nursing industry. In this piece, we will explore the rising cost projections, the potential consequences, and alternative solutions to improve the quality of nursing home care. So, let’s dive in!
The Cost Projection and Implications
The consulting and advisory firm CliftonLarsonAllen recently conducted an updated analysis, revealing a significant increase in the projected cost of implementing a federal staffing mandate for skilled nursing facilities. According to their findings, a standard 4.1 hours of staff per patient per day could cost the industry a staggering $11.7 billion annually.
This figure represents a substantial rise from the previously projected $11.3 billion in January, highlighting the ongoing inflation and wage pressures that continue to plague the sector. Moreover, this $1.7 billion increase over the past 13 months underscores the severity of the workforce shortage crisis affecting skilled nursing facilities across the country.
Cory Rutledge, the director of assurance for CliftonLarsonAllen, emphasizes the potential worsening of the problem if the staffing mandate is implemented. Currently, less than 10% of skilled nursing facilities meet the 4.1 hours per patient per day requirement. Rutledge states, “There are actually two levers to pull to get to 4.1: either you hire a lot more people, which doesn’t exist… or you fire residents to lower the denominator.”
Given these projections, the potential consequences go beyond the financial toll. The American Health Care Association (AHCA) warns of the displacement of 446,000 residents if the rule were to come into force. Rutledge expresses concern for the nation’s most frail seniors who would have to find alternative care options.
In addition to the financial burden and potential displacement, smaller-margin Medicaid providers, particularly in rural and urban communities, may face additional wage pressure, leading to further closures. The repercussions of a staffing mandate are far-reaching and require careful consideration.
Alternative Solutions for Improving Quality of Nursing Home Care
Considering the high cost and potential negative implications of a staffing mandate, Rutledge proposes several alternative solutions that the federal government can invest in to enhance the quality of nursing home care. Through reducing the sector’s reliance on agency staff, a range of equal or less costly solutions can be implemented. Some of these solutions include:
- Investments in improving employee engagement and reducing turnover
- Funding for remote patient monitoring and predictive analytics
- Promotion of wellness and support programs to keep seniors out of nursing homes for longer
Rutledge highlights the correlation between poor quality nursing homes and the use of outsourced labor. By addressing this issue, quality improvement can be achieved more effectively and at a lower cost. A relevant analysis conducted by CliftonLarsonAllen found that 1-star rated facilities used 2 1/2 times more contract staff than their 5-star counterparts in every state, demonstrating the need for a targeted approach.
Furthermore, Rutledge acknowledges that shrinking the agency is not the sole solution to quality concerns. Instead, ensuring consistent staff presence, rather than just increasing the number of personnel, is crucial for better care provision. Additionally, government funding for nursing homes to invest in non-staff resources such as remote patient monitoring and predictive analytics can enhance care delivery.
Conclusion
While the issue of staffing in skilled nursing facilities remains a significant challenge, it is essential to consider alternative solutions beyond a rigid staffing mandate. By addressing the underlying issues of outsourced labor and investing in employee engagement and non-staff resources, the quality of care can be improved without imposing universal staffing levels.
The rising cost projections, potential displacements, and financial pressures faced by Medicaid providers necessitate a careful and thoughtful approach to tackle the workforce shortage crisis. Let’s move beyond the headlines and work toward practical solutions that will make a real difference in the lives of seniors relying on nursing home care.
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Summary:
The consulting firm CliftonLarsonAllen projects that a potential federal staffing mandate requiring 4.1 hours of staff per patient per day in skilled nursing facilities could cost the industry $11.7 billion annually. This represents an increase from the previously projected $11.3 billion and signals the ongoing workforce shortage and inflationary pressures affecting the sector. Implementing such a mandate may lead to the displacement of 446,000 residents and additional closures of smaller-margin Medicaid providers. In response, CliftonLarsonAllen suggests alternative solutions to improve nursing home care by reducing reliance on outsourced labor, investing in employee engagement, and funding non-staff resources like remote patient monitoring. Improving quality without imposing universal staffing levels is crucial for the long-term viability and well-being of skilled nursing facilities.
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The price is rising for a potential federal staffing mandate.
A standard 4.1 hours per patient per day could cost the skilled nursing industry $11.7 billion a year, according to an updated analysis from consulting and advisory firm CliftonLarsonAllen.
That’s an increase from the $11.3 billion projected in January and an increase of $1.7 billion in the 13 months since the CLA issued its first estimate in mid-2022.
The potential cost has been increased by inflation and continued wage pressures, as the ongoing workforce shortage continues to affect the entire country.
“People are starting to make the connection to say that if we implement the staffing mandate, the problem is going to get much worse,” he said. Cory Rutledge (pictured), director of assurance for CliftonLarsonAllen. “As we stand here today, less than 10% of skilled nursing facilities are working at 4.1 hours per patient per day. … There are actually two levers to pull to get to 4.1: either you hire a lot more people, which doesn’t exist… or you fire residents to lower the denominator.”
AHCA forecast Wednesday some 446,000 residents would be displaced if a rule came into force 4.1.
“That’s thousands of our nation’s most frail seniors who would have to go somewhere else and I don’t know where that place is,” Rutledge said in response Friday.
Additional wage pressure on smaller-margin Medicaid providers, especially in rural and urban communities, could also lead to more closures, he added.
With the price tag so high and the potential negative implications of a staffing mandate, Rutledge suggested several equal or less costly solutions that the federal government could invest in to improve the quality of nursing home care. Chief among these were investments that reduce the sector’s reliance on agency staff.
“In our opinion, the headline should not be about the mandated staffing of 4.1 hours per patient per day,” he said. “Instead, the headline should be that outsourced labor is correlated with poor quality nursing homes. That is the correlation. That’s the problem we need to fix, and it’s a problem that’s actually less expensive and, in my opinion, easier to fix.”
A CLA analysis found that 1-star rated facilities used 21/2 times more contract staff than 5-star rated facilities. Rutledge said that trend continued in every state, with predictable steps and patterns.
In Illinois, for example, CLA found that 1-star facilities filled 15.6% of their jobs with temporary workers, while 5-star facilities used only 3.8%.
“If we really want to improve quality without decreasing access, we should invest in a lot of things to improve employee engagement and reduce turnover, which would reduce the use of outsourced labor, which would improve quality in nursing homes. “.
Pressed by the idea that quality concerns existed long before the pandemic-era explosion of agency staff placements, Rutledge said he didn’t expect shrinking the agency to be the only solution. But he would promote better quality of care by having consistent staff (rather than just more personal) to the facility, he said.
He also suggested that the government better fund nursing homes so they can afford to invest in remote patient monitoring, predictive analytics and other non-staff resources that intensive care providers are already using to improve care. Even promoting wellness and support programs that help keep seniors out of nursing homes for longer would be a better way to improve care than imposing universal staffing levels, she added.
“We will never achieve perfection,” Rutledge said. “What we are looking for is progress. To make progress on this problem facing our society, we need to have practical solutions. I would say that a staffing mandate of 4.1 hours per patient per day is simply not a practical solution. Let’s move on to find something that’s practical and moves the needle.”
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