Why Are Nursing Homes So Understaffed?

If one of your family members has ever needed nursing home care, you probably know this feeling of worry. With all the horror stories out there in the news, how can you know whether a particular nursing home is any good? How can you trust that they’ll take good care of your loved one??

Nursing home quality has long been an item of concern in the US, particularly those operated by for-profit firms, including private equity-owned firms. ?Last week, NYTimes ran an article specifically about nursing home staffing levels. It contained some really painful stories. One patient described lying in bed for? hours in his own feces, because he couldn’t get to the bathroom without help, and no one responded to his call button.

In one way, this is a labor market story, since most of the cost of running a nursing home lies in salaries and benefits for the staff. Much of this labor is supplied by nursing assistants, who do a physically demanding, often unpleasant, low-paid job. (Aside: this is why, back when I was on a medical school admissions committee, we looked favorably on candidates who had worked as nursing assistants.) Nursing home operators claim that they can’t find enough workers wiling to do these jobs. Baloney. It’s simply a matter of labor supply and demand, which is to say, if you pay people enough, they’ll take undesirable jobs, but if you don’t, they won’t. There’s a reason why entry-level unskilled positions on offshore oil rigs start around $50K/year, with half of the year as vacation. On the other hand, when nursing assistants find that they can make more money flipping burgers than changing bedpans, well, you get the picture.

So why aren’t wages rising for nursing home workers? Because the for-profits who operate the majority of nursing homes have figured out that they can get away with jobs going unfilled. And the fewer workers they employ, the higher their profits are. Patients falling and breaking their hips, or alternatively lying in soiled bedsheets, because no one was available to help them to the bathroom? Sorry, the fiduciary duty to shareholders comes first.

So not surprisingly, governments have stepped in to try to regulate staffing levels. The Biden Administration recently published a rule requiring staffing at a level that only 20% of nursing homes currently meet. Several states have established their own standards, including California, New York, Rhode Island, Massachusetts, and Florida (Although Governor DeSantis subsequently cut Florida’s standards way back in response to industry pressure.)

So problem politically solved, right?

No. There’s a huge enforcement gap. On the federal level, nursing homes have 5 years before enforcement will begin, even assuming that the rule isn't repealed or scaled back in the mean time. On the state level, California has the most history, with minimum staffing requirements for over 20 years. So you’d think that by now they’d have their ducks in a row. Yet California inspectors continue to identify deficient staffing (the most recent numbers show a third of facilities to be out of compliance). This might have something to do with the fact that California regulators also issued a large number of waivers to homes who said they couldn’t find enough staff (and presumably said they couldn’t afford to raise wages?). State regulators don't like to issue fines to social service organizations that are already struggling financially, even if that struggle is related to some private equity firm having previously extracted most of their assets.

Rhode Island appears to be even more lax on enforcement than California: 52/74 recently inspected facilities were found to be understaffed. The NYTimes article described residents and their family members calling in complaints, but not receiving any responses.

One potential solution to this problem is to expand our concept of enforcement. Government agencies don’t have to be the sole, or even the primary, enforcers of the rules that they publish. There are other entities, including private citizens and organizations, who are motivated to hold nursing homes accountable, but need the legal tools to do so.

Consider for example the Dutch education authorities early in the COVID pandemic. For remote instruction they needed lots of new software licenses for Zoom, Google Classroom, and Microsoft Teams, but could see that these products had significant privacy holes. Did they wait for European privacy regulators to issue fines and otherwise pressure the companies into compliance? No. They negotiated with the companies directly, using the EU’s GDPR privacy law as leverage (more specifically, the threat of filing a lawsuit).

In the case of nursing homes, maybe states could create private rights of action for citizens and family members, and perhaps also municipalities, to file lawsuits against nursing home companies when individual homes fail to meet patient care standards.

Bottom line: financialization and acquisition of nursing homes by large operators has broken the accountability link to patients and communities. Governments, probably at the state level, need to figure out how to restore that link.

To schedule me to speak at your event, or to access the full Hippocratic Capitalism archive free of charge, see www.hippocraticcapitalism.com