A new study in the Journal of the Post-Acute and Long-Term Care Medical Association (JAMDA) confirms that higher reliance on Medicaid reimbursement is directly associated with lower staffing levels and expenditures in nursing homes—even as these providers devote a greater share of their revenue to staffing. Researchers analyzed 2023 Medicare Cost Reports and Payroll-Based Journal data from more than 11,500 nursing homes and found that nursing homes with 86% or more Medicaid-funded resident days delivered 3.4 hours of direct care per resident day, compared to 4.08 hours in homes with less than 50% Medicaid. The decline was in nursing hours generally, including RNs, LPNs, and nurse aides.
Nonprofit nursing homes reduced staffing more sharply as Medicaid reliance increased, a finding the study surmised is largely because nonprofits start at higher staffing levels than for-profit peers and thus have more room to cut. While high-Medicaid homes spend less on nursing in absolute terms, they allocate a larger percentage of their limited revenue to staffing—leaving fewer resources for other essential services like meals, activities, and therapy. The study concludes that minimum staffing mandates must be accompanied by adequate Medicaid reimbursement and underscores the need for policymakers to address Medicaid rate adequacy, especially in the face of staffing regulations and potential budget cuts. LeadingAge will continue to advocate for sustainable funding solutions that reflect the true cost of care.
