Providing the Nurses we Need to Address the Nursing Shortage and Improve Health Care for All Americans

AARP Health Care Reform Priorities

Investing in a nursing workforce with the right numbers and the appropriate skill set is crucial to meeting the goals of health care reform, especially the much needed delivery system reforms that will lower health care costs and improve patient care.

To ensure Americans have a nurse, with the right skills, when and where they need one, Congress should take two actions: 1) modernize Medicare nursing education payments to help produce more advanced practice nurses; and 2) establish a reliable, dedicated source of funding for nursing education capacity.

Problem 1: Outdated Medicare Funding System

Currently, Medicare reimburses hospitals that directly operate nursing education programs for a portion of the costs of these activities. In 1965, nurses were primarily educated through hospital-based programs. The nursing education system has dramatically changed since then. Medicare payment policy should likewise change to prepare the kind of skilled nurses needed to more effectively and efficiently care for Medicare beneficiaries.

Common Sense Solution: Modernize Medicare Funding to Prepare Highly Skilled Nurses

Beginning October, 2011 payments would be made to hospitals for the training costs of preparing advanced practice nurses with the skills necessary to provide primary and preventive care, transitional care, chronic care management and other nursing services appropriate for the Medicare population. This graduate nursing education would be provided through affiliations with accredited schools of nursing and in partnership with two or more non-hospital community-based care settings in which portions or all of the clinical training is carried out.  Hospitals would reimburse nursing schools and community-based care settings for their portion of the training costs.  

Problem 2: No Stable Source of Funding for Nursing Education

Besides Medicare, which as noted above limits its support to poorly-targeted hospital-based training programs, the largest source of federal aid for nursing education comes from Title VIII of the Public Health Services Act. And, unlike Medicare, funding for the Title VIII program is contingent on annual appropriations that have ebbed and flowed over the years. These funds provide an unreliable and inadequate source of support for nursing schools to grow and maintain capacity, including much needed support for competitive faculty salaries, to produce adequate numbers of registered nurses and nursing faculty.

Common Sense Solution: Create a Dedicated Source of Funding to Increase the Number of Nurses Nationwide

Should a dedicated stream of money for health care workforce needs be established through health care reform, Congress should assure that an adequate portion of those funds be dedicated to ensuring that our nation has enough skilled nurses to meet the increased demand of a reformed health care system and a retiring baby boom generation.  Specifically, AARP supports giving the Secretary of HHS (operating through the Health Resources and Services Administration) the authority to make up to $200 million a year from any such workforce funding system in capitation grants to qualified nursing programs to increase their capacity and therefore the number of appropriately skilled registered nurses. This funding would be in addition to monies appropriated under Title VIII and protections would be included to ensure that they would supplement, not replace Title VIII appropriations. Payments would be made based on the number of additional students enrolled by nursing schools. Funds could be used for a range of activities such as increasing faculty salaries and moving faculty from part-time to full-time. To begin and continue to receive funds, schools of nursing would have to meet a set of new accountability standards.