Medicare reimbursement deficits: are nursing costs to blame?

Nursing costs were found to be only 11% of the total operating costs. This finding dispels the myth that nursing service is an expensive expenditure for hospitals. The range of facility cost compared with DRG reimbursement was wide, which points to the need to scrutinize costs other than nursing as the sources of hospital deficits. Nursing costs were found to be lower than facility or OR costs. Nurse managers need to emphasize this cost effectiveness to decrease the chance of staffing cuts and requests for concessions in wages or benefits for nurses. Nurse managers need to plan their financial activities to ensure their hospital cost is less than, or at most equal to, the DRG payment.