Nurse Staffing Shortage Drives Hospital Readmissions, High Spending

August 18, 2021 - Medicare spent an estimated $5 billion on hospital readmissions in 2018, which could be partially explained by nurse staffing shortages, a recently rereleased Government Accountability Office (GAO) report found.

Nurse staffing shortages may result in more hospital readmissions and higher Medicare spending at skilled nursing facilities (SNFs), the report revealed.

Medicare spent an estimated $5 billion on hospital readmissions in 2018, and almost $28 billion on short-term care after hospital stays in 2019, GAO found. An uptick in readmissions may lead to cuts in reimbursements for skilled nursing facilities.

Better payment incentives and additional reporting on staffing information could alleviate the problem.

Skilled nursing facilities are required to have one registered nurse on duty for eight consecutive hours, seven days per week, and provide 24-hour licensed nurse staff services for all residents. Previous research found a correlation between adequate SNF nurse-to-resident staffing ratios and lower rates of readmission.

While almost all SNFs met the requirement for having a registered nurse on-site eight hours per day, few SNFs met other staffing metrics that specify numbers of nursing hours per resident. Only one in four facilities met the nurse staffing levels needed to avoid care issues.

“For example, about half of SNFs frequently met Centers for Medicare & Medicaid Services (CMS) case-mix measures—hours worked per resident that vary based on the medical needs of each SNF's residents—that CMS uses to set SNF staffing ratings,” GAO reported.

“Further, about one-quarter of SNFs frequently met staffing thresholds for minimum RN and total nurse staffing that a CMS staffing study identified as needed to avoid quality problems. SNFs are not subject to these quality thresholds for ratings or as requirements, but many stakeholders have recommended that they be used as SNF staffing thresholds.”

GAO recommended that Congress direct HHS to impose payment reductions on SNFs that generate additional Medicare spending on seemingly preventable incidents and readmissions. GAO made three primary recommendations to CMS to combat this issue.

First, GAO suggested that the CMS administrator should report weekend nurse staffing level decreases on the Care Compare website.

Second, GAO suggested that “The Administrator of CMS should report minimum RN and total nurse staffing thresholds below which SNF residents are at increased risk of quality problems—such as thresholds that are similar to those identified in the CMS staffing study—on the Care Compare website.”

In response, HHS agreed to report weekend decreases in staffing levels, but did not agree to report minimum nurse staffing benchmarks needed to ensure quality care.

Lastly, GAO recommended that CMS incorporate “into the Five-Star System staffing ratings information on weekend decreases in RN and total nurse staffing levels, and minimum RN and total nurse staffing thresholds below which SNF residents are at increased risk of quality problems.”

HHS agreed with GAO’s third recommendation but pointed out that it would need to conduct further analysis to determine what the minimum staffing thresholds would be, and how staffing impacts resident care quality.

“Nevertheless, as discussed in our report, SNFs can receive a 3-star rating yet have staffing levels that fall below the CMS staffing study thresholds,” GAO pointed out.

“Without information on minimum thresholds needed to provide quality care, beneficiaries will be limited in their ability to make fully informed choices about quality of care when selecting a SNF.”

A recent study also indicated that nurse understaffing can lead to cognitive failures, risky practice management workarounds, and decreased patient safety.