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The state ballot initiative on nurse staffing ratios would cost hundreds of millions of dollars a year, according to an estimate issued Wednesday by the Massachusetts Health Policy Commission (HPC), an independent watchdog that keeps an eye on health costs.
"The HPC’s analysis of mandated nurse staffing ratios estimates $676 million to $949 million in annual costs once fully implemented," the panel says in a release. And those estimates are likely low, it says, because the analysis did not have data to include all hospital units that would be affected by the staffing ratios.
Proponents of the ballot measure — Question 1 — protested before the estimate was even released.
Their statement read, in part: "This guess on costs by the HPC is irresponsible and inconsistent and resembles nothing that the HPC has ever done before. This estimates a cost of $300k per nurse [full time equivalent], per year, and — like the inflated numbers distributed by hospital executives — there is no independent data source or transparency in these cost estimates."
[Editor's note, 10/5: Asked to respond to that calculation, the commission said in a statement: “The HPC's cost impact analysis of nurse staffing ratios estimated the need for 2,286 to 3,101 new nurses in order to meet the mandate. While not a part of our presentation, we can report that the estimated cost for each new nurse is $133,285 to $138,765. This includes both the estimated salary (with an estimated wage increase of 4%-6%) and the estimated cost of benefits. Our analysis included additional costs NOT associated with these new RNs, such as costs for acuity tools and wage increase for currently-employed RNs in Massachusetts.”]
Question 1's backers are supported by the Massachusetts Nurses Association. The backers' cost estimate for the measure came in far lower, at $35 to 47 million per year.
The HPC's full report is here. Here are some key findings, outlined in the release:
- The HPC examined California’s experience with a mandated nurse staffing ratio law, the Commonwealth’s current RN workforce and staffing at Massachusetts hospitals, and estimated costs associated with mandated ratios.
- The HPC’s analysis of mandated nurse staffing ratios estimates $676 million to $949 million in annual costs once fully implemented. The estimates are likely to be conservative due to a lack of detailed staffing data on additional hospital units such as emergency and outpatient departments. The estimates include the cost of hiring additional registered nurses (RNs) to meet the staffing requirements, wage increases for existing RNs, and implementation costs at the Commonwealth’s state-operated hospitals.
- The estimates also do not include certain expected one-time costs to implement the mandate, including the purchase and implementation of acuity tools (estimated $57.9 million one-time cost) and costs of turnover and recruitment.
- The HPC also examined the potential for cost savings associated with increased RN staffing. Based on academic literature, the HPC calculated a range of estimated potential savings of $34 million to $47 million from reduced hospital length of stay and reduced adverse events. Additional cost savings could be realized due to RN turnover and workforce injuries.
Members of the Health Policy Commission made clear Wednesday that their estimates were preliminary, and that they expect a much deeper discussion at hearings scheduled for Oct. 16 and 17.
But they were already sounding concerned about the potential consequences of mandated staffing ratios.
"I think one of the questions we'll have to think about is, what does this mean in the Massachusetts context, where we're trying to hold down the rate of spending and where the hospitals that would be hit the most are those with high public-payer patients?" said Harvard health economist David Cutler, a panel member.
Professor Stuart Altman, the commission's chair, warned that the Massachusetts ballot initiative is different enough from a similar California law — both in its particulars and in the state hospital environment — that caution should be used on comparisons.
Still, the panel heard about the California law and its effects from Dr. Joanne Spetz, a University of California San Francisco expert on health care workforce issues. In her summary, the law — which went into effect in 2004 — did bring on an increase in nurse staffing and a moderate hike in nurse income averaging about 4 percent. There have been no comprehensive analyses of what it did to overall health care costs, she said.
Study results on the effects on patient care have been mixed, Spetz said.
"Some outcomes got worse, some got better, some had no statistical significance in their change," she said. "And so taken together, I interpret the literature as a little bit of a wash. It's very hard to conclude that the California regulations systematically improve the quality of patient care across all outcomes."
The Massachusetts measure, overall, could amount to an additional 1.1 to 1.6 percent in health costs for the state, which currently run over $61 billion, estimated David Auerbach, director for research and cost trends at the Health Policy Commission. "So that's a substantial amount," he said.
Speaking to reporters after the commission meeting, Julie Pinkham, executive director of the Massachusetts Nurses Association, took issue with the numbers and said the issue boils down to patients feeling safe when they enter a hospital.
"The one thing that this does different is it really, for the first time, gives a vote to people and puts them in control of health care," she said. "It's one measure that says it's not going to be secret sauce anymore, folks. When you go in the hospital, you'll know how many patients that nurse is supposed to have, and what your level of expectation should be."
Speaking for the Coalition to Protect Patient Safety, which opposes the ballot measure, spokesman Dan Cence summed up his takeaways from the HPC analysis: "No increase in quality of patient care. I think the cost question is off the table now. I think California is off the table now. So why are we here? What does this bring?"
This segment aired on October 3, 2018.
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