Medicare funding of nurse education. The case for policy change

To determine the magnitude and distribution of US Medicare funding for nursing education and to assess the extent to which Medicare funding contributes to meeting national health care workforce priorities.

Medicare Hospital Cost Report Information System, American Hospital Association Annual Survey of Hospitals, and National League for Nursing national surveys of schools of nursing.

Using hospital identifiers, data from three data sets were merged and analyzed to estimate percentage distributions of Medicare funding according to types of educational programs, hospital characteristics, and student enrollment.

Fifteen percent of direct Medicare graduate medical education funding goes to hospitals for the training of nurses and paramedical personnel. Totaling approximately $174 million in 1991, 71% of these funds went to hospitals for nursing education costs. Most of the nation's teaching hospitals (289 of 381 Council of Teaching Hospitals member hospitals) and nurse education programs (1112 of 1484) do not qualify under existing policies for Medicare nursing education reimbursement. Sixty-six percent of Medicare nurse training funds, totaling $114 million in 1991, went to 145 hospitals operating diploma nursing programs; these programs produce less than 10% of nurse graduates. Three states (Pennsylvania, New Jersey, and Ohio) received nearly one half (48%) of the $114 million for diploma nursing education.

Medicare is the largest single source of federal support for nursing education. Yet, the majority of Medicare nursing education funding goes to hospitals affiliated with an increasingly smaller, idiosyncratic subset of nurse training programs. Unlike graduate medical education, Medicare supports primarily preprofessional education in nursing. Graduate education, including the preparation of nurse practitioners, does not generally qualify for reimbursement. Medicare reimbursement for nursing education must be retargeted.