The organization of nursing care and resident health status: The impact on nursing home cost

The public health problem addressed by this study is the crisis in the organization and financing of nursing home care to the elderly in the United States. There are increasing numbers of elderly and the 5 percent of those currently living in nursing homes are sicker and more dependent than before prospective payment began in 1983.;This study investigates the relationships between nursing home characteristics, resident health status and nursing home costs. Data from the 1985 National Nursing Home Survey were used to test hypotheses relating nursing home costs to case mix (resident functional dependence and psychosocial status), registered nurse hours per day, ratio of registered nurses to residents, registered nurse employment role and decision making, and registered nurse education. Using OLS regression, three different measures of costs were examined. Variables known to influence costs, were included in equations as controls. The regression results indicate that increasing resident functional dependence (nurse intensive case mix) and registered nurse hours per day were associated with higher nursing, average patient care and total costs. An increased ratio of registered nurses to residents was associated with higher patient care costs but lower total costs per day. The nursing position with the most autonomy showed significant cost lowering impact on average patient care and total costs per day. The baccalaureate education of registered nurses was not related to costs. Consistent with the hypotheses, nurse intensive case mix and higher ratio of RNs in the nursing home increase the costs of nursing home care. Nurses in administrative positions play a significant role in controlling costs in nursing homes.;Implications of the findings are for registered nurses and their professional organizations, the nursing home industry and health policy. Nurses can use the cost function analysis to justify and extend their supervisorial and administrative activities and autonomy in nursing homes. Nursing homes can use the analysis to develop staffing that promotes quality while remaining cost efficient. Policy implications are for the promotion of administrative content in nursing education, continued development of case mix measures reflecting nurse intensity, and the revision of staffing standards in the regulation of nursing homes.