Effects of improving nursing staff wages on turnover

California implemented a new cost based reimbursement system for Nursing homes (AB1629) that led to significant improvements in RN and LVN hours (26.2% and 29.4% of facilities were above 95th confidence interval). Nurse aide hours increased from an average of 2.37 in 2004 to 2.40 in 2006 but the percent of homes above and below the predicted trend were about equal. Wages for all three groups were above the predicted trend (25.5%, 20.0%, and 32.1% of facilities for RN LVN and aides respectively) than were below the trend (13.9%, 14.2% and 8.55% respectively). These changes reflected significant improvements in important staffing measures. Despite that turnover rates for all nursing increased, with 33% to 38% of homes showing a significant increase in turnover. There was no correlation between the increased investment made by homes in nurse staffing and turnover rates.

Interviews were conducted with nursing staff in a sample of 32 homes who reported making significant investment in staffing in an effort to determine why there were not changes in turnover. Based partially on these interview data we have identified two primary reasons for the absence of a relationship between staffing improvements and turnover.

1.The increase in hours and wages were not large enough to alter the workers perception about the quality of their work situation.

2.The wage increases were not large enough to attract new workers to the labor pool and thus the existing labor pool simply moved between different homes.