If Congress heeds hospitals' calls to increase Medicare fees to help solve their workforce crunch, the help may come with a catch: Hospitals would have to prove that they hire more workers with the extra money or risk losing the cash.
Congress is expected to use a funding template it created in 2000 in determining Medicare nursing home reimbursement. That year, legislators added $1.5 billion-a 2.1% increase-to Medicare's projected spending for nursing home care from 2001 to 2005 in part by bumping up by 16.7% the payments to skilled-nursing facilities for nursing costs in 2001 and 2002.
But that increase came at a price. Congress also mandated an audit of nursing home payroll records and cost reports to find out whether they really hired more nurses with their payment increase. That audit, to be prepared by the General Accounting Office, also must make recommendations on whether the increased reimbursement should continue past Sept. 30, 2002, the end of federal fiscal 2002.
Hospitals are using a similar plea to the one employed by nursing homes last year: Because nurses and other healthcare workers are in short supply, hospitals need increased Medicare revenue to help them raise wages for nurses and other hospital workers.
The American Hospital Association is calling for a package of Medicare payment increases worth $16.2 billion between now and 2006. In addition, it wants Congress to spend about $12 billion for a grant program to spur nurse training and education.
This month, the AHA and six other hospital groups are asking hospital executives and trustees around the country to pass resolutions calling for workforce relief and deliver the resolutions to members of Congress during its yearly August recess (July 30, p. 4). It will be followed up by advertising in September.
But the AHA's payment-increase proposals don't specifically state that hospitals would have to spend more on wages. That omission sparked skepticism from the American Nurses Association, which will push Congress to make hospitals accountable for the new money.
"They're looking for a good argument, and we're it," Erin McKeon, associate director of government affairs with the ANA, says of hospitals.
"We don't have blind faith in the trickle-down theory. Any money given to the hospital on the basis of a nursing shortage should be directly tied to nurse staffing and there should be accountability," McKeon says.
AHA officials say that's a price they're willing to pay.
"To the extent that the government gives us an inflation update, and they want to go back and look at where the money went, we have no problem with that," says Thomas Nickels, the AHA's senior vice president for federal relations.
But Nickels also cautions that specifically earmarking money for nursing and other workers in Medicare's inpatient hospital prospective payment system is much more difficult than in the PPS for skilled-nursing care.
That's because the skilled-nursing PPS consists of four different payments-one for nursing, two for therapy and one for administration-while the inpatient hospital payment is more unified.
Whether the increased payment led to increased pay for nurses "would be an easier thing to figure out in a nursing home," he says.
Whether higher Medicare reimbursement will lead to increased staffing is a subject of debate. The report from the GAO, Congress' oversight agency, isn't due until August 2002. And although at least one analysis says higher Medicaid nursing-home reimbursement has yielded improved nurse staffing, experts note a stronger relationship exists between state-mandated staff ratios and higher nurse staffing.
Charlene Harrington, a professor at the University of California at San Francisco nursing school, found in a study of 1998 figures that some facilities in states with high Medicaid reimbursement rates had relatively small nursing staffs.
"Just setting a high rate (of Medicaid reimbursement) doesn't necessarily do anything (to increase the number of nurses)," Harrington says. "A state has to follow through" with enforcement of nurse-staffing ratios.