Want to end historic health care strikes? Fix a broken, outdated reimbursement model

History was made this month as more than 75,000 workers staged the largest health care strike to ever take place in the United States. The Kaiser strike is over, for now, but there is no clear resolution in place, and other strikes are still under way or on the horizon.

At the same time, we are in the midst of a nurse staffing crisis. About 800,000 nurses plan to leave the workforce by 2027, and more than half of newly graduated nurses are leaving the profession within two years. The reasons why this is happening have nothing to do with a lack of passion for the profession or care for patients. Rather, it has everything to do with poor working conditions that stem from an outdated reimbursement model for nursing services.

According to a recent McKinsey survey, inadequate staffing is one of the primary reasons why nurses are leaving their profession, and poor staffing levels don’t come out of nowhere. There is no hospital reimbursement model in place for nurses. This means that hospitals get paid the same whether they have one nurse or eight taking care of four patients. The ramifications of this financially unsustainable model have plagued the industry for decades, causing unsafe nurse-to-patient ratios and creating little or no incentive for many nurses to continue in the profession. To put it simply, nursing has become dangerous.

The history behind this problem dates back more than a century. In 1920, the 19th Amendment was ratified, securing women the right to vote. Following this monumental milestone, nursing emerged as one of the few established career avenues for women to attain financial equality and independence. Nurses during the 1920s owned and managed independent private nursing practices and billed patients directly for their nursing services, according to Penn Nursing.

The eventual shift to continuous nursing care transformed hospitals into the primary hubs for health care delivery. Upon discharge, patients received hospital bills that billed for nursing services, alongside physician and hospital services. But in the 1930s, hospitals began viewing private-duty nurses as competitors and started hiring nurses directly. The contributions of registered nurses were soon obscured within room and board fees, rather than recognized as billable provider services.

Today, despite extraordinary progress in the delivery of health care and significant transformations in the scope of the nursing practice, Medicare continues to bundle nursing services within both hospitals and nursing homes as facility charges. Nurses are viewed by health care facilities as overhead, rather than generators of revenue. This is among the reasons why I became a nurse staffing industry executive and also why I co-founded a nonprofit commission focused on addressing the reimbursement issue. I am committed to helping bring about an end to the nurse staffing crisis, and I believe fixing the reimbursement problem, and creating better career opportunities for nurses, are critical to our path forward.

Since hospitals and nursing homes cannot separately bill for nursing services, they resort to cutting nursing positions or increasing nurse-to-patient ratios to either reduce costs or increase revenue. There are few incentives to invest in nurses, or to invest in technology, processes, or training that will help nurses do their jobs more effectively. As a result, nurses sit squarely on the losing side of health care systems’ profit-and-loss statements. This forces nurses to care for more patients per shift, a situation that not only creates added stress, but compromises the quality of patient care.

And this can be life-threatening. A study conducted by the University of Pennsylvania showed that for each additional patient assigned to an average nurse, the likelihood of in-hospital mortality, extended length of stay, and 30-day readmission all significantly increase. I recall an incident from my days as a nurse on a busy surgical floor. It was a Sunday, and we had four nurses and one CNA caring for 24 patients — six patients per nurse. One patient was in late-stage kidney failure and needed dialysis, but the hospital didn’t do dialysis on Sundays. I did everything I could for him, but when my shift ended, I warned my colleague, “This patient is going to code.” And later that evening, he did.

Given this, it’s no wonder that strikes have become more frequent. Nurses have been stretched to the breaking point. They are working in environments in which it is nearly impossible to give patients the care they need. It is a harsh reality that during a health care work stoppage, a patient with a health care emergency may die. During a prolonged strike, some hospitals may need to divert patients or may remain open only by bringing in contract labor. But nurses and other health care workers recognize that if they don’t strike, patient lives will still be lost.

One possible solution to rectify the broken, outdated nursing reimbursement model is for Congress to amend the Social Security Act (which governs Medicare) and finally introduce a reimbursement code for bedside nursing services. Another viable option, as proposed by the American Nurses Association, is for the Center for Medicare and Medicaid Innovation to experiment with various reimbursement models for nursing, selecting the most effective one based on the resulting data. These changes could be accompanied by adjustments to room rates and the introduction of quality metrics that tie reimbursement rates to clinical outcomes — enabling this new model to remain cost-neutral or even to generate cost savings based on improvements to care.

All of this is possible (assuming a functional Congress). New Medicare billing codes have been added over the past century for a variety of health care practitioners, including advanced practice nurses like nurse practitioners.

The key to establishing a sustainable nursing workforce across all health care settings lies in dismantling a century-old model that categorizes nurses as costs. Nurses are the beating heart of our health care system. When they are no longer treated as liabilities but rather as reimbursable service providers, the inherent discord in health care regarding nurse staffing levels can be resolved, easing the nursing shortage and putting an end to frequent and historically large health care strikes. While some may argue against this change, the reality is that if we want a sustainable future for the nursing profession, improved patient outcomes, and viable, thriving health care systems, we can’t afford not to.

Rebecca Love is a nursing industry advocate and chief clinical officer of IntelyCare.