Nursing home spending, staffing, and turnover

Area of Science:

• Healthcare Management
• Nursing Home Administration
• Health Economics

Background:

• Nursing home staffing and turnover are influenced by ownership and resources.
• Limited research exists on how spending behaviors affect nursing home staffing and turnover.

Purpose of the Study:

• To investigate the association between financial ratios (spending behaviors) and staffing levels/turnover in nursing homes.
• To determine if financial ratios explain the role of ownership in staffing outcomes.

Main Methods:

• Cross-sectional analysis of 1,014 Texas nursing homes using 2002 Medicaid Cost Reports and 2003 Area Resource File data.
• Examination of financial ratios by ownership type.
• Robust regression models to assess the impact of 10 financial ratios on staffing levels and turnover for registered nurses (RNs), licensed vocational nurses (LVNs), and certified nursing assistants (CNAs).

Main Results:

• Not-for-profit homes had higher expense ratios for resident care and staff development.
• Higher profits correlated with lower staffing levels but not increased turnover.
• Administrative expenses negatively impacted LVN and CNA staffing and turnover, but not RN staffing.
• Employee benefit expenses positively influenced RN and LVN staffing levels.
• Financial ratios reduced the influence of ownership on staffing indicators.

Conclusions:

• Effective management practices are crucial for addressing nursing home staffing and turnover.
• Adequate administrative and employee benefit expenses are necessary for staff recruitment and retention.
• Financial ratios offer partial explanations for ownership's impact on nursing home staffing and turnover.