The Characteristics of the Long-Term Care Sector:

The Characteristics of the Long-Term Care Sector:

Impact on the Supply of Nursing Labor

Courtney Stewart

Meghan Roscio

Econ 331-35

Professor Gleason

December 11, 2002

I. Introduction

The United States has around 1.56 million residents in 16,840 nursing homes. In order to take care of these people, a lot of nursing labor is required. The nursing staff mostly includes Registered Nurses (RNs), Licensed Practical Nurses (LPNs), and Certified Nursing Assistants (CNAs). There has been an increasing shortage of nursing labor, and many characteristics of the nursing home system have had a large impact on this shortage. The level of Medicaid and Medicare spent on nursing homes accounts for an immense proportion of the sources of nursing home payments. Therefore, they have a huge effect on services of the nursing home. The staffing levels are also influenced by whether the nursing home is for-profit or nonprofit. According to several studies, nonprofits tend to have better staffing. The structure of the nursing home affects individual’s decisions to work in this field. Many facets of structure cause the shortages of nursing homes, and they need to be examined in order to determine possible solutions to the shortage problem.

II. Nursing Homes in General

Many elderly, and a few disabled non-elderly, enter a nursing home when they are no longer able to live independently. In 1996, the United States had 1.56 million residents in nursing homes. The size varies widely, but the average number of beds in a nursing home is one-hundred and four. Most nursing homes are for-profit, 65.9 percent, with 26.2 percent private nonprofit government and the remaining 7.9 percent government owned. Many nursing homes have waiting lists. The overall occupancy rate is 88.8 percent, but is generally lower in states without certificate-of-need regulation.[1] Certificate of need programs established criteria to determine public need for health care facilities and programs. A request for changes to the structure of a facility and, in certain states, a change in program offerings of individual health care institutions must be made to determine need.[2] Over a lifetime the probability of nursing home use is high. Out of all persons over the age of 25, twenty-seven percent will use a nursing home at some point in their life. For women, the probability is greater than 50 percent, and for men it is one-third.[3] This may be due to the shorter life expectancy of men, which may result in widowed women entering nursing homes who are unable to care for themselves once their husbands pass away.

Nursing home care is extremely expensive, and insurance is not complete in the United States. The nursing facility industry currently comprises the largest part of the long-term care business, with spending in 2000 of $92.2 billion, with further expected growth as the population ages. Nursing facility spending growth actually declined from 9.1 percent in 1995 to 0.2 percent in 1999, and then increased in 2000 to 3.3 percent.[4] For a private pay resident, one year in a nursing home can cost more than $47,000. About half of residents are covered by Medicaid, and the reimbursement rate for them is typically ten to thirty percent less. The residents covered by Medicaid must spend down their assets and contribute most of their monthly income. Medicare only pays 11.4 percent of nursing home revenues because it only covers nursing home care immediately following an acute hospital inpatient stay and only up to one-hundred days. The wide variation in length of stay, and the lack of complete insurance mean that the elderly face considerable out-of-pocket costs.[5]

III. Medicaid

Medicaid is an important factor in the issues that nursing homes face, and it has an impact on the shortage of the workforce in the nursing homes. Congress passed legislation in 1965 establishing the Medicaid program as Title XIX. Medicaid was established in response to the widely perceived inadequacy of welfare medial care under public assistance. It is the largest source of funding for medical and health-related services for America’s poorest people. Each state establishes its own eligibility standards, sets the rate of payment for services, administers its own program, and determines the type, amount, duration, and scope of services. Over the years, Medicaid eligibility has been progressively expanded beyond its original ties with eligibility for cash programs. Legislative changes also focused on increased access, better quality of care, specific benefits, enhanced outreach programs, and fewer limits on service.[6]

Each state’s Medicaid program must pay for nursing home care for eligible persons age 21 and older. In 1996, nursing homes accounted for 61 percent of Medicaid Expenditures for long-term care, and 46.5 percent of the sources of nursing home payments came from Medicaid. In order to be eligible for Medicaid, individuals must meet strict income and asset rules. In most states, aged or disabled adults who are eligible for Supplemental Security Income (SSI) are also eligible for Medicaid. In 1998, the federal SSI limits for individuals are $494 per month in countable income and no more then $2,000 in countable assets. Special income eligibility rules refer to persons who receive Medicaid long-term care services in a nursing home or through a waiver program. Individuals whose income is not adequate to cover their health and long-term care costs can usually qualify for these long-term care services, even if their income exceeds the SSI standard. However, to qualify individuals must contribute nearly all of their income to pay for their care. Individuals must meet the state’s functional eligibility criteria to receive Medicaid coverage for long-term care services, in addition to meeting the financial eligibility criteria. The state’s functional eligibility criteria vary across states, but generally include both health status and physical and cognitive functioning.[7]

IV. Medicare

The Medicare program was passed by Congress in 1965 as Title XVIII of the Social Security Act. In 1966, Medicare covered most persons age 65 or over. In 1973, other groups also became eligible for Medicare benefits. These groups include persons entitled to Social Security or Railroad Retirement disability cash benefits for at least twenty-four months, most persons with end-stage renal disease (ESRD), and certain otherwise non-covered aged persons who elect to pay a premium for Medicare coverage. Medicare has traditionally consisted of two parts: hospital insurance (HI), also known as Part A, and supplementary medical insurance (SMI), also known as Part B. Skilled nursing facility care is covered by HI only if it follows within thirty days of a hospitalization of three days or more and is certified as medically necessary. The number of skilled nursing facility days provided under Medicare is limited to 100 days per benefit period, with a co-payment required for days 21-100. HI does not cover nursing facility care if the patient does not require skilled nursing or skilled rehabilitation services.[8] In 1995, Medicare only covered 9.4 percent of nursing home costs, compared to Medicaid’s coverage of 46.5 percent.[9] Due to the extreme difference in amount of coverage of nursing home costs between Medicaid and Medicare, the impact of Medicaid on nursing homes is more relevant and has a larger effect on the composition of the workforce.

V. For-Profit v. Nonprofit

Another factor included in the impact of the workforce shortage in nursing homes, is the distinction between a nursing home being for-profit or nonprofit. Therefore, the difference between these two forms of organization must be examined. The relevant distinction of the nonprofit is the “nondistribution constraint.” That is, the laws allow no one a legal claim on the nonprofit’s residual. A residual is the difference between the revenues and costs of a firm. This quantity is also known as a firm’s profits. Nonprofit’s objectives may differ from those of a for-profit firm, because there is no residual claimant. Two other distinctions between the profit and nonprofit firm are consequential. First, nonprofit firms are exempt from corporate income taxes and often from sales and property taxes, which for-profits are not. The only tax advantage enjoyed by for-profits is the ability to write off losses during rough years. Second, any donations made to nonprofit firms receive favorable tax treatment. In general, financial advantages enjoyed by nonprofit firms stem from the subsidization of nonprofits by government through such tax exemptions.[10] One study found that 80 percent of hospitals, which are largely nonprofit, spend more on community benefits then they receive in tax breaks. Therefore, something other than tax breaks must enable nonprofits to successfully compete with for-profits. Most people believe that nonprofits rely on charitable contributions to compete. However, most nonprofit health care organizations receive very little money from charity, often less than 1 percent of total revenues. The money that is received from donations is guaranteed to be used specifically for the nonprofit health care organization, due to state statues that prevent it from going directly into the pockets of managers.[11]

In order to compete with for-profits, health care organizations must gain the trust of their patients. Trust is questioned when patients hear the word profit. An easy way for health care organizations to win the trust of their patients is to set aside the profit motive, which is accomplished through nonprofit organizations. It is assumed that nonprofit organizations will put aside the profit motive, and act in the best interest of their patients because they do not have any incentive to cut costs. Nursing homes and other long-term care facilities make up about 10 percent of the health economy. They are a mix of nonprofit and for-profit firms, and nonprofits have dominant market shares among non-Medicaid patients. Many for-profits offer goods and services that provide a community benefit, but they may not do enough. Communities must rely on nonprofits to account for what the for-profits fail to provide, such as health services for the uninsured. Without nonprofits, this and other goods and services may not be available.[12]

In addition to trust, nonprofit supporters argue that quality also accounts for their ability to keep up with for-profits. In the health economy it is difficult for patients to know if they are receiving high quality care. Due to this lack of knowledge, trust and quality are dependent upon each other. Patients lack medical knowledge that would allow them to be an efficient and effective purchaser of health care goods and services. They need to trust the health care organization that they are using to provide the quality they need, and being nonprofit or for-profit plays a large role in this distinction. Profit driven sellers in many cases provide the wrong products, at less than adequate quality, in those markets where it is difficult for consumers to evaluate their own needs and quality is hard to measure. When patients make choices on their own health care, such as when selecting a nursing home, they may prefer a provider whom they believe is less likely to take advantage of them. Nonprofit health care providers may be exactly what they are searching for. Managers of charitable nonprofits presumably have less incentive to cut costs by reducing quality, unlike those of for-profits. Hospitals and other health care organizations have many opportunities to cut back on quality in ways that patients cannot easily detect. For example, an inadequate staffing level needed to provide timely and continuous care, improper credentials of the staff, faulty equipment that may limit quality, and lack of utilization of services. Patients unable to recognize these cut backs on quality may reasonably believe that nonprofits will place quality above profits. This belief will give nonprofits the ability to survive in competitive markets.[13]

VI. Composition of the Nursing Staff

The supply of nursing labor, which includes Registered Nurses (RNs), Licensed Practical Nurses (LPNs), and Certified Nursing Assistants (CNAs), are impacted by the characteristics of the long term care sector. RNs are responsible for a large portion of the health care provided in the United States. Their responsibilities include providing direct patient care in a hospital or in a home health care setting, managing and directing complex nursing care in an intensive care unit, or supervising the provision of long-term care in a nursing home. LPNs make up the second largest group of health care providers. They provide direct patient care under the direction and supervision of a physician or RN. In 1999, there were an estimated 150,000 RNs and 208,000 LPNs working in nursing homes.[14] Both RNs and LPNs are subject to state licensing requirements. Individuals usually choose one of three ways to become an RN. These choices include a 2-year associate degree, 3-year diploma, or a 4-year baccalaureate degree program. LPN programs are 12 to 18 months in length and generally focus on basic nursing skills such as monitoring patient or resident condition and administering treatments and medications. By law, RNs must assess residents’ needs. RNs and LPNs work together to plan care, implement care and treatment, and evaluate residents’ outcomes. Nurses must be licensed in the state and are on site to provide care to residents twenty-four hours per day, seven days a week. [15]

In nursing homes, Certified Nurse Assistants (CNAs) are the principal care givers. CNA duties include providing resident care and assisting RNs and LPNs. They assist residents with activities of daily living, such as eating, bathing, using the toilet, dressing, and lifting and helping residents in and out of bed. CNAs also administer medications and provide emotional support for residents. Although CNAs are not required to have a high school diploma or other work experience, federal law requires that CNAs and Medicare and Medicaid-certified nursing homes complete a minimum of seventy-five hours of training and pass a competency evaluation within four months of employment. In 1999, there were an estimated 695,000 CNAs working in nursing homes. On average, CNAs earn $8.16 an hour, as compared to RNs who earn $21-$25 an hour and LPNs who earn $16-$20 an hour.[16]

VII. Where do the shortages come from?

The United States is currently facing a shortage of nurses. There are many factors that contribute to the shortage. An important factor in the current shortage is the higher proportion of patients having more complex needs, which increases the demand for nurses with training for specialty areas. Also, the increased use of technology in care settings has increased the demand for a higher skill mix of RNs. A nursing shortage may have serious implications for the quality of patient care. A recent Health Resources and Services Administration (HRSA) study found a relationship between higher RN staffing levels and the reduction of certain negative hospital inpatient outcomes. Additionally, a recent Health Care Financing Administration (HCFA) report to Congress found a direct relationship between nurse staffing levels in nursing homes and the quality of resident care. HCFA’s analysis of three states’ data demonstrated that there is a minimum nurse staffing threshold below which quality of care may be seriously impaired.[17]

VIII. Future Expectations for the Shortage of Nurses

The future demand for nurses is expected to increase dramatically when the baby boomers reach their 60s, 70s, and beyond. From 2000 to 2030, the population aged 65 years and older will double. At the same time, the number of persons who have traditionally worked in the nursing workforce is expected to remain relatively stable. The traditional people working in nursing are women between 25 and 54 years of age. Over the past decade, the nurse workforce’s average age has climbed steadily, while fewer young persons are choosing to enter the nursing profession. The total number of licensed RNs increased only 5.4 percent between 1996 and 2000, which is the lowest increase ever reported in HRSA’s periodic survey of RNs. According to a 1999 Nursing Executive Center Report, between 1993 and 1996, enrollment in diploma programs dropped 42 percent and enrollment associate degree programs dropped 11 percent. Additionally, enrollment in baccalaureate programs declined 19 percent, and enrollment in master’s programs decreased 4 percent. Furthermore, there is a concern about a pending shortage of nurse educators.[18]

In determining the extent of future nurse shortages, job dissatisfaction is another thing that may play a crucial role. Recent surveys of nurses have found decreased job satisfaction, and a high portion of respondents have reported increased pressure to accomplish work, the need to work overtime, and illness related to stress. A recent Federation of Nurses and Health Professionals survey found that half of the currently employed nurses who were surveyed considered leaving the patient-care field for reasons other than retirement over the past two years. Of this group of nurses, 56 percent indicated that they wanted a less stressful and physically demanding job, 22 percent said they were concerned about schedules and hours, and 18 percent wanted more money. Nursing home and home health care industry surveys indicate that the nurse turnover is an issue. In 1997, a survey sponsored by the American Health Care Association (AHCA) of thirteen nursing home chains identified a 51 percent turnover rate for RNs and LPNs.[19]

IX. Future Expectations for the Shortage of Nurses Aides

Furthermore, the shortage of nurse aides is also expected to worsen over the coming decades, and will prove to be a large problem for nursing homes, because CNAs are the principal care givers. With the aging of the population, demand for nurse aides is expected to grow dramatically, while the number of persons who have traditionally filled these jobs will change very little. Several state or local studies cite nurse aide recruitment as a problem for many providers. Over half of private nursing homes reported staff vacancy rates higher than 10 percent, and nineteen percent of nursing homes reported vacancy rates exceeding 20 percent. Providers also have problems with retention of nurse aide staff. Annual turnover rates among aides working in nursing homes are reported to be from about 40 percent to more than 100 percent.[20]

Additional factors contributing to nurse aide turnover include low wages, and few benefits. On average, nurse aides receive lower wages and have fewer benefits than workers generally. Moreover, the lower wages and less benefits received is particularly true for the nurse aides working in nursing homes and home health care. Aides working in hospitals are much more likely than aides in nursing homes and home health care to have employer-provided health and retirement benefits. Most nursing homes and home health care agencies do not offer pension coverage, and only 21 to 25 percent of aides in these settings are covered. Current Population Survey data shows that many nurse aides have sufficiently low earnings and family incomes to qualify for public benefits such as food stamps and Medicaid. While 11 percent of all workers had family incomes below poverty, 18 percent of aides working in nursing homes had incomes below that level.[21]

Negative effects have been associated with the high turnover of nurse aides. These negative effects are related to both costs for the facility and quality of patient care. Direct provider costs of turnover include recruitment, selection, and training of new staff, overtime, and use of temporary agency staff to fill spaces. Indirect costs associated with turnover include an initial reduction in the efficiency of new staff and a decrease in nurse aide morale and group productivity. High turnover can disrupt the continuity of patient care. Aides may lack experience and knowledge of individual residents. Also, when turnover leads to shortages, nursing home residents may be hurt because of the increased number of residents the remaining staff must care for, which equals less time to care for each resident.[22]

X. Gender Segregation

Gender segregation is another issue that has led to shortages in the supply of nursing labor. Gender segregation in the labor force is a pervasive phenomenon with deep roots in the gender division of labor in both modern and historical societies. As the proportion of women in the labor force has increased, women have entered both traditionally female and traditionally male occupations. A reason for this is the sharp rise of both master’s and bachelor’s degrees awarded to women in various professions. In the past several years women have been entering predominantly male occupations, while at the same time, there has been an increase in men entering predominantly female occupations. In general, any position that involves supervisory capacities is disproportionately male. Nursing is an example of a female-dominated profession where the tendency for men to achieve a supervisory position is evident. Many female nurses resent men who choose to enter the nursing profession due to this view. Resentment by the female nurses may steer men away from the nursing profession. The gender segregation found within the nursing profession is a monumental factor of the increasing shortage.[23]

Low wages earned by nurses can also be attributed to the gender segregation issues within the nursing profession. Men tend to become more and more concentrated in the higher-paying jobs within an occupation. An increase in female participation of a specific occupation may be accompanied by job “de-skilling”. “De-skilling” is the process by which jobs in an occupation become more mundane and generally involve less responsibility. These situations may or may not involve persons that have either less formal education or less on-the-job training. “De-skilling” may be a primary reason for falling wages in occupations that become more female-dominated.[24] Studies have alleged that between 25 percent and 50 percent of what registered nurses are asked to do in hospitals has nothing to do with nursing, and involves running errands, doing paperwork, delivering and retrieving laboratory specimens, and so forth.[25]

XI. The Human Capital Model

The earnings made by men and women vary due to gender differences in formal education, work experience, and on-the-job training. The earning variations in these categories are generally affected by differences in human capital. Many forms of human behavior can be considered investments in human capital. Skilled labor embodies human capital. A broad conception of human capital would include any form of investment that increases a person’s well-being. The gender earnings gap can be explained by the systematic differences in type of human capital. Women may be more likely to invest in human capital that has high non-market return, while men usually invest with high market return. Additionally, women may be more inclined to invest in human capital that increases the level of satisfaction that they will receive from time spent at work or during leisure. Men, on the other hand, tend to invest in human capital that will yield them a high return in wages, but little increase in satisfaction.[26]

Education is an important investment in human capital. The human capital model (Figure 1) can be used to examine how the structure of nursing homes affect an individual’s decision to pursue further education, the reasons for the education levels of current nurses and nurses aids, and how these levels affect the shortage. The earnings path for the typical high-school educated worker is fairly flat. By contrast, the profile for the typical college-educated worker is rising with age and crosses the profile for the high-school worker shortly after college graduation. The shaded area in Figure 1 represents costs to a college student for tuition, books, and fees associated with attending college for four years. The profile for most college student is negative during their four years. In Figure 1, the total cost per year of attending college is C, because the individual does not work. By attending college an individual forgoes a starting yearly salary of E_0. When the individual graduates, he/she receives a starting yearly salary of B₄, which is higher than the starting salary that would have been received upon graduating high school but lower than the salary that would have been earned if he/she worked continuously since high school, E₄. The individual will soon overtake and pass the high school graduate. The difference between these profiles represents the net benefit of receiving a college education relative to a high school education.[27]

Due to the low level of wages earned in the nursing home sector, individuals have less of an incentive to invest in the necessary amount of time required to become an RN or LPN to increase their human capital level. In Figure 1, the cost of amount C outweighs the potential benefit in earnings represented by the difference between the college path and the high school path. Also, it is difficult for many individuals to afford college. Therefore, in order to attend school they need to take out loans or receive some form of financial aid. Due to the low wages of the nursing profession, it is not feasible for them to be able to increase their human capital because they will not receive adequate compensation to pay back any loans. For this reason, nursing homes predominately employ CNAs.[28] In 1999 the number of RNs working in nursing homes was 150,230, the number of LPNs was 208,030, and the number of CNAs was 695,570. This statistically demonstrates the likelihood of individuals to forgo a college education under the current structure of nursing homes.[29]

XII. The Effect of For-profit v. Nonprofit on the Shortage

Whether a nursing home is for-profit or nonprofit has an additional effect on staff shortages. Registered nurses are paid higher wages by nonprofit than by for-profit nursing homes. For this reason alone, RNs will be more inclined to work for a nonprofit nursing home. As described previously, only 26.2 percent of nursing homes are nonprofit. Therefore, they are all in competition with one another for the limited number of jobs available in the higher wage nonprofit sector of the nursing home industry. If they do not receive one of these positions, few may be willing to accept the lower wage jobs found in the for-profit nursing homes. Besides the attraction of higher wages, nonprofit nursing homes have also been credited with higher quality care. Many nurses want to be associated with quality, and will seek employment where this is found. Nonprofits are formed in response to patients’ informational limitations in assessing quality. Specifically, because of the difficulties in distinguishing among nursing homes of varying quality by patients, the market will fail to produce high-quality nursing homes. The higher wages RNs receive in the nonprofit sector can be attributed to the premise that because nonprofits do not distribute the residuals, they are less interested in minimizing the costs. Therefore, nonprofits are willing to pay nurses higher wages to get higher quality. The higher wages will attract nurses with more experience, which will result in fewer available experienced nurses for the for-profit sector.[30] For-profits also contribute to the shortage of nurses by cutting back on quality in ways that patients cannot easily detect. A for-profit nursing home may reduce the amount of staff that they hire in order to save money. Also, they may reduce the amount of staff training even if it is necessary; in order to increase their profit by reduced spending. These qualities of a for-profit nursing home will add to the shortage.[31]

XIII. The Effect of Medicaid and Medicare on the Shortage

Medicaid and Medicare are important sources of support for long-term care for the frail elderly. Together, the two programs account for more than half of nursing home expenditures. Medicaid is the most significant source of coverage for nursing home care, providing around 46 percent of nursing home payments. Medicare plays a smaller role in financing long-term care, but skilled nursing facility benefits is among the fastest growing components of Medicare spending. Due to these large contributions, these programs have a big impact on the nursing staff shortage. The passage of the Balanced Budget Act of 1997 inadvertently led to a 10 percent cut in Medicare funding. A temporary fix by Congress in 1999 and 2000 of this inadvertent cut has recently expired, and is now affecting all nursing homes that provide skilled nursing services. Congress believed that a long-term fix for Medicare would be in place by now, and that funding for Medicaid would be higher. Neither of these assumptions proved true. The soft economy and tightening of individual state budgets mean less money coming into the nursing homes from state Medicaid payments. Together, the reduction in Medicare and Medicaid payments makes it harder to attract and retain qualified staff, aiding in an already serious nursing shortage.[32]

XIV. Possible Solutions for the Nursing Homes

With a nursing shortage on the rise, there are certain measures nursing homes can take to help reduce the problem. First, the nursing homes can interview departing employees to determine why they are leaving and periodically survey current staff members. By doing so, they will be able to better address the needs and concerns of their employees, which will possibly lead to a reduced turnover rate. By occasionally surveying their employees, nursing homes will show their concerns for their staff members, which will boost morale by recognizing good performance. Also, nursing homes can enlist staff in finding potential co-workers to increase employment levels. Nursing homes can also promote the job as one that makes a difference, which will lead to a feeling of importance among the employees and will give them a positive reason to remain on the job. An alternative way for nursing homes to improve their working environment and aid in the shortage is to prepare a positive orientation program to set the tone for the future employee. Along with organizing a positive orientation program, nursing homes can organize voluntary peer support groups to help nurses deal with their job pressures. If they do not feel as pressured while at work, they will be more inclined to remain. With very few opportunities for career advancement currently, nursing homes can develop new job titles that nurses can strive to obtain providing them with increased responsibilities and a boost in their confidence. As well, developing new job titles will lead to more job satisfaction. Often times, nurses do not feel as though they are a part of the planning and decision making that occurs within nursing homes. To accommodate these concerns, supervisors within the nursing homes can be better trained to include nurses in such decisions, while at the same time providing flexibility, feedback, and a willingness to listen to their ideas. As a means of increasing a nurse’s level of human capital, nursing homes can provide on-the-job continued education and training in ethical dilemmas, conflict resolution, and communication with families. The key to a successfully run nursing home with satisfied staff is to treat nurses and nursing assistants with respect and dignity, by not allowing them to feel as though they are easily replaceable or unskilled, because they are neither.[33]

XV. Possible Solutions for State, Local, and Federal Government

The nursing shortage must also be addressed by state and local governments as well as the federal government. The public, policy makers, and the nursing profession must engage in ongoing long-term workforce planning, regardless of the perceived or real pressures related to the short-term demand for nursing services. Workforce planning must be done in order to encourage the development and preparation of nursing personnel with skills appropriate to the health care system. By ignoring the trends of the nursing shortage discussed above, the nation is in danger of experiencing serious breakdowns of the health care system. State, local, and federal governments must combine strategies to recruit and retain nurses with strategies to overcome the workforce issues that have discouraged long-term commitments to a career in nursing.[34]

One of the leading recommendations in the fight to improve the shortage is through education. The development of career progression initiatives will move nursing graduates through graduate studies more quickly, and identify the range of options available beyond the entry-level role such as faculty, researcher, and administrator. Also, more support for health care employers to create and sustain staff development programs and lifelong learning for continued competence is needed. In order to promote the recruitment of a younger, more diverse population of nursing students, youth ages 12 to 18 can be targeted through counselors, youth organizations, and schools. Also, non-traditional groups, such as men, have to be sought out.[35] Additionally, the encouragement of associate degree nurses to continue their education and expand enrollment in schools of nursing is necessary. A barrier to this proposed solution is that many students lack the financial means of accomplishing this goal. Therefore, forgiving loans and establishing nursing scholarships is needed. A press release issued by the American Nurses Association (ANA) in 2001 called for increases in the funding of educational opportunities. The Nurse Reinvestment Act and the Nursing Employment and Education Development Act would authorize federal funding for scholarships and loan repayments for nursing students who agree to work in shortage areas after they graduate. In addition, both of these bills would include career ladder programs, funding for curriculum development and nursing faculty, and public service announcements aimed at promoting nursing as a career. The ANA believes these bills are necessary in addressing the nursing shortage.[36]

Nurses with contrasting education and practice competencies bring different skills to patient care, and they need to be able to practice to the fullest potential of these capabilities. Practice environments must recognize and reward these differences by defining nurses’ roles and by compensating and utilizing nurses according to their different educational preparation and competencies. By doing this, nursing homes can compete with other industries as attractive professional working environments. One of the ways work environment issues can be addressed is by implementing specific strategies to retain experienced nurses in the provision of direct patient care. Retaining experienced nurses can be accomplished by introducing greater flexibility into the work environment structure and scheduling programs, rewarding experienced nurses for serving as mentors for new nurses, and by implementing appropriate salary and benefit programs. In order to keep the aging and experienced nurses, it is necessary to redesign work to allow this population of the workforce to remain an active and important part of the direct care of patients. These suggestions are just a few ways in which the issues that deal with the work environment affecting the nursing shortage can be addressed.[37]

Certain measures can be taken in the form of legislation and regulation to handle the shortage of nurses within the health sector. State and community leaders must advocate for increased nursing education funding under Title VIII of the Public Health Service Act, which is designed to increase access to health care in underserved areas, and other publicly funded initiatives to improve the capacity and resources for education of a desirable nursing workforce. Lowering the cost of nursing education will allow more people to view the tradeoff discussed in Figure 1 as more desirable. Also, they must advocate for better identification of registered nursing services within Medicare, Medicaid, and other reimbursement systems.[38]

Improvements in technology, research, and data collection are needed to efficiently and effectively aid in the shortage. By investigating the potential for using technological advances, the capacity of a reduced nursing workforce can be enhanced. Support for workforce planning by the Division of Nursing and other public or private nursing organizations can lead to the development of models for health workforce planning that consider both the need and demand for nursing services. The promotion of consistent data collection at the national, state and local level can account for variations at each level to enable appropriate workforce planning for registered nurses. Increases in technology, data collections, and research are a small, but important contribution to the shortage. They have potential to drastically improve efficiency levels within the nursing workforce, which is an influential and useful solution to the problem.[39]

XVI. Conclusion

The shortage of Registered Nurses, Licensed Practical Nurses, and Certified Nursing Aids is an increasingly growing problem within the United States. To begin the process of eliminating this pressing issue, the structure of nursing homes needs to be broken down and examined. This will allow the inefficiencies within the system to be discovered. Only after this is accomplished will the necessary solutions to conquer this problem present themselves. The structure can be broken down into several main components. The components include Medicaid and Medicare funding, whether the nursing home is for-profit or nonprofit, and the characteristics of the actual nursing home staff. All of the components of this health care system influence the decisions made by nurses. These decisions include whether or not to pursue a career in the nursing field, and once in the field whether or not to remain. The nursing shortage is directly affected by the choices made by nurses and those interested in the field. Therefore, many of the proposed solutions to the shortage problem need to be directed towards positively affecting the outcome of their choices, which can be done through systematic plans of action in changing education, the work environment, legislation and regulation, and technology, research and data collection. Until such action is taken, the United States will be faced with a constant threat of a shortage of essential workers in the nursing sector of the health care system.

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