This is not just a saying, it is reflected in the business of healthcare. Let’s look at one of the largest healthcare corporations in the United States, HCA healthcare. Evidence of this physicians generate income, nurses cost money idea can be seen in HCA healthcare’s financial statements. Their discussion of physicians compared with nurses and ancillary staff in their 2021 financial statements when discussing labor matters perfectly illustrates this point. “Physicians are an integral part of the success of our hospitals in delivering quality care to our patients (HCA Healthcare, 2022, p. 33).” Here doctors are viewed as an asset contributing to corporate success. “In some markets, nurse and medical support personnel availability and retention have become significant operating issues to healthcare providers (HCA Healthcare, 2022, p. 33).” Here retaining and hiring nurses is not “integral to success” but an expensive labor cost and operational issue. This point is further driven home by a recent article that reports that HCA healthcare is among several hospital operators looking to increase rates to offset labor costs, especially for nurses (Lokuwithana, 2022). This drive to increase rates has little to do with any actual need or lack of funds. For HCA healthcare, revenue increased 14% from $51.533 billion in 2020 to $58.752 billion in 2021 and net income increased from $3.754 billion in 2020 to $6.956 billion in 2021 (HCA Healthcare, 2022, p. 66). As we know, in corporate, for-profit system money is the driving factor for decisions made within that system.
Nurses are an expensive labor cost that corporations want to decrease, minimize, and offset.
From that view, there is no motivation for any healthcare corporation to increase nursing staff. That is a problem central to the nursing shortage. Insufficient staffing is a major factor that drives nurses to leave the bedside and/or the profession. A survey conducted in November of 2021 found that 32% of respondents (a 10% increase in less than ten months) reported thinking about leaving the bedside (Berlin et al., 2022). One of the major driving factors reported was insufficient staffing (Berlin et al., 2022). While several states have adopted legislation to adopt mandatory nurse-to-patient ratios, it isn’t enough. State-by-state legislation is cumbersome and complicated. What is needed is a federal standard. This could be accomplished by tying nurse-patient ratios with either reimbursements or increased payments from the Centers for Medicare and Medicaid (CMS).
This would change nurses from an expensive labor cost to a means of financial savings or income generator. Nurses already add value and decrease costs to healthcare facilities. Research has shown that increased nurse staffing improves the quality of care. Increased nurse staffing levels lead to decreased rates in healthcare-acquired infections (Mitchell, Gardner, et al). Healthcare-acquired infections (HAIs) are a significant cost to facilities. According to the CDC costs from HAIs in U.S. hospitals exceeds $28.4 billion annually. Additionally, research shows that increased nurse staffing and having higher proportions of bachelor’s degree nurses are associated with lower patient mortality (Haegdorens et. al. 2019). It is clear that nurses add value, but right now that value is not translated into dollars on a balance sheet.
CMS Value-Based Programs
The precedent has already been set for incentivizing quality care through reimbursement and/or increased payments. CMS value-based programs do just that. For example, one CMS value-based program, that many nurses are familiar with, is the Hospital-Acquired Condition (HAC) value reduction program. This program reduces reimbursement for such conditions as pressure ulcers, and post-operative sepsis acquired during the hospital admission ((CMS’ Value-Based Programs | CMS, n.d.)) Another, CMS value-based program, that fewer nurses may be aware of, is the Quality Payment Program. This program is designed to reward high-quality Medicare clinicians with payment increases (Quality Payment Program Overview, n.d.).
If these programs are about quality care it is the logical next step to add safe nurse staffing to CMS.
The evidence is available to show that increased nursing staff leads to safer, higher-quality care, and linking safe staffing ratios to reimbursement or to increased payments would incentivize healthcare corporations to increase nurse staffing levels. This would relieve one of the factors driving nurses away from the bedside.
References
Berlin, G., Lapointe, M., & Murphy, M. (2022, February 18). Surveyed nurses consider leaving direct patient care at elevated rates. McKinsey & Company. Retrieved June 1, 2022
CMS’ Value-Based Programs | CMS. (n.d.). CMS.Gov. Retrieved June 1, 2022,
Haegdorens, F., Van Bogaert, P., De Meester, K. et al. The impact of nurse staffing levels and nurse’s education on patient mortality in medical and surgical wards: an observational multicentre study. BMC Health Serv Res 19, 864 (2019).
HCA Healthcare. (2022, February). 2021 Annual Report to Shareholders.
Lokuwithana, D. (2022, May 9). Hospitals seek price hikes to offset rising nursing costs - WSJ. SeekingAlpha. Retrieved June 1, 2022,
Mitchell BG, Gardner A, Stone PW, Hall L, et al. Hospital staffing and healthcare-associated infections: a systematic review of the literature. Jt Comm J Qual Patient Saf. 2018;44:613–22.
Quality Payment Program Overview. (n.d.). Retrieved June 1, 2022