Iowa lawmakers failed to advance nursing home legislation. Why and what’s next?

Iowa's nursing homes continue to be plagued by low staffing and high turnover.

According to data from the federal Centers for Medicare and Medicaid Services, 14% of Iowa's 422 nursing facilities were cited for insufficient staffing in fiscal year 2023.

That's more than double the national average of 5.9%, according to reporting by the Iowa Capital Dispatch. Only five other states had a worse record of complying with federal law that requires all nursing homes provide sufficient nurse services to safely care for and meet their residents' needs.

And more than 43% of Iowa nursing homes do not meet upcoming federal mandates on staffing levels, a new national report shows.

Nearly 30 nursing homes across the state have closed since June 2002, related to staffing challenges and financial distress.

Lawmakers fail to pass nursing home legislation

House Republicans ahead of the 2024 Iowa legislative session said lawmakers must step up and protect Iowa's nursing homes and health care institutions.

"Staffing shortages continue to put tremendous pressure on our nursing homes and hospitals," House Speaker Pat Grassley, R-New Hartford, said in his opening remark on the first day of the legislative session in January.

"We need to pursue policies that help these critical industries ensure they can provide quality, consistent care at a reasonable cost to the Iowa taxpayers," he said.

While portions of their legislative proposals were incorporated into budget bills, lawmakers failed to pass substantive nursing home legislation this year, including a bill backed by House GOP leadership and the nursing home industry to cap payment rates that staffing agencies could charge for their temporary nursing services.

While approved by the Iowa House in February, the Senate did not advance to the bill out of committee.

Sen. Adrian Dickey, a Republican from Packwood who chairs the Senate Workforce Committee where the bill was assigned, said Senate Republicans want to work with long-term care facilities to find a solution, "but rate caps aren't the solution."

Dickey declined further comment, stating the 2024 legislative session had just recently ended and "talking about legislation for 2025 at this point is very premature."

Bills proposed by both Republicans and Democrats failed to advance this session.

Among them:

Caps for travel nurses to fix nursing home worker shortage (House File 2391)Nursing home patients' Medicaid allowance (Senate File 2303)Nursing home oversight (Senate File 2304)Minimum wage for direct care workers (Senate File 2305)Allowing cameras in nursing homes to check residents' care (House File 2317)

Lawmakers, though, passed a provision included in the budget that funds the Department of Health and Human Services that requires the Department of Inspections, Appeals and Licensing to provide joint training sessions to nursing home facilities and inspectors about the most common citations issued to nursing homes.

Sen. Claire Celsi, D-Des Moines, criticized Republicans' budget for not containing more funding to help nursing homes address staffing and patient safety issues.

"There remains an urgent crisis in our nursing homes," Celsi said. "Seniors and vulnerable Iowans are asking us to fix this. … They are depending on us, and we have failed them."

House Republicans explore pay caps for travel nurses

Speaking to reporters moments after the session ended in April, Grassley said House Republicans intend to revisit the issue of capping payment rates that staffing agencies could charge for their temporary nursing services to help Iowa's nursing homes manage costs.

Grassley said the current system has created a budget crisis for Iowa health care facilities, increased costs on the state and resulted in lower quality of care for patients.

Iowa Medicaid patients account for roughly half of Iowa's nursing home population.

"The number of residents in our nursing home facilities that are on Medicaid, I assume that's going to continue to go up," Grassley said. "And as those pressures continue to build on our providers, we need to be looking at a lot of new bold ideas. We consider that to be one. … And we look forward to having that be something we want to talk about in the campaign to make sure we're continuing to provide quality care for Iowans."

Nursing homes and hospitals across the state have increasingly relied on travel nurses and temporary staff to fill workforce gaps. Demand soared during the pandemic as health care facilities first struggled with spikes in COVID-19 infections, then increases in patients returning for medical care they had put off for months.

The travel nurse segment reached its peak in 2022, growing to more than six times its 2019 market size, according to Staffing Industry Analysts.

Reliance on temporary nursing staff has continued in recent years as the supply of available nurses to hire for permanent positions has dwindled.

Nursing home and hospital nursing staffs have witnessed high turnover as thousands of nurses have quit their staff positions to become contract travel nurses, where the pay is substantially higher.

While staffing agencies help fill temporary nursing holes, Iowa nursing home administrators and direct care workers say it is not a viable solution to the chronic staffing shortages plaguing many of the state's long-term care facilities. They also worry about continuity and quality of care for patients.

Grassley said House Republicans will continue to push progress on the issue next year as a way to help nursing homes provide quality, consistent care at a reasonable cost to Iowa taxpayers.

What did pass this year

While the bill failed to make it across the finish line this year, House Republicans point to other, successful attempts this session to grow Iowa's health care workforce.

House File 2391: Education Budget

Last session, Iowa House Republicans created the Iowa Workforce Grant and Incentive Program to provide scholarships to students studying to fill high need jobs. This budget allocates another $6.5 million to that program which includes several health care professions such as nursing.A continued commitment of $500,000 to the Health Care Professional Recruitment Program that awards $50,000 toward reducing the student loan debt of a health care professional after they've worked in an eligible Iowa community for four years.$2.6 million, a $125,000 increase, for the Rural Iowa Primary Care Loan Repayment Program designed to recruit physicians into high-need rural areas.$500,000 for the Health Care Loan Repayment program for athletic trainers, occupational therapists, physicians, physician assistants, podiatrists or physical therapists that work four years in an eligible Iowa community.$520,000 for the Mental Health Practitioner Loan Repayment Program for individuals who provide mental health services to high-need communities.Provides a $2.8 million increase in funding to the University of Iowa Department of Nursing to employ additional instructors and increase the number of students who graduate from the college of nursing.

House File 2698: Health and Human Services Budget

Provides an increase to community mental health centers, physical therapists, medical supplies, occupational therapists, physician assistants and nurse midwives based on the 2023 Medicaid rate review.This budget provides a $3 million increase to home health rate.

Is capping staffing agency rates the solution?

Nursing home advocates have emphasized that many factors have led to nursing shortages in health care facilities in the state. And they say addressing an overreliance on temporary staffing must be part of a broader conversation about health care workforce shortages.

The same advocates note low wages have driven high turnover among direct care staff.

Democrats introduced a package of legislation hoping to spur conversations with Republicans and find common ground to improve the care and oversight of Iowa's nursing homes and protect seniors from neglect and abuse. The package included raising the minimum wage for nursing home workers and hiring additional nursing home inspectors. The legislative proposals failed to advance.

Under House Republicans' proposal, payment rates for nursing services provided by staffing agencies could be no more than 150% of the statewide average paid the previous year.

There are 125 staffing agencies based in Iowa and 325 total agencies provide staffing services to the state, according to the American Staffing Association.

Brent Willett, president and chief executive officer of the Iowa Health Care Association that represents the state's long-term care facilities, said nursing homes in Iowa spent $49 million on agency staffing in 2019. By 2022, those total costs rose to $184 million, he said.

While use of temporary nursing staff and rates has since declined to pre-pandemic levels, Willett and nursing home officials report the price tag imposed by staffing agencies still is a major burden.

"While we have seen a decline, fortunately, in overall utilization of temporary staffing agencies by nursing homes, the costs associated with the hours we are using continue to be higher than we had ever seen before," he said.

Because of these increasing costs, Willett said administrators have struggled to afford higher wages and better benefits for permanent staff.

If the cap on staffing agency bill rates was approved and signed into law, it would have saved Iowa nursing homes $22 million in overhead costs, according to Willett.

"We would like to use those dollars saved to redeploy to increase wages for permanent staff and recruit others to work in the industry," he said. "That's money that can be used for higher and better use to expand Iowa's workforce instead of propping up margins for Iowa's staffing agencies," and provide continuity of care.

"With increased pressure of Iowa Medicaid system, we have to identify areas of savings to the system to be redeployed to quality of care," he said.

But the proposal could have the opposite of its intended impact, said Bob Livonius, chairman of the American Staffing Association and board member of an Iowa-based staffing company with 33 years in the industry.

Livonius said nearly two-thirds of nurses who work through staffing agencies have other full-time jobs, and that those nurses could be driven out of staffing positions if the proposed legislation becomes law. He said that would create even more strain on nursing homes when they look to staffing agencies when in need of temporary workers.

Instead of encouraging travel nurses to seek full-time jobs at nursing homes or hospitals in Iowa, Livonius said they will opt to leave the state in search of travel contracts that will continue to pay them higher wages.

"During the pandemic, there wasn't enough supply and there was huge demand. And so rates went up and you had to pay more," he said. "Now, that's all flip-flopped and nursing homes have increased pay and the supply-demand curve has changed. There's no big demand for contract labor."

According to the American Staffing Association, demand for temporary contract nursing position fell 30% from 2023 to 2024 year to date.

"It's a supply issue," American Staffing Association's Toby Malara said. "We need more nurses and need to entice nurses to say in the industry. … We need more nursing schools and nursing faculty."

Nursing home administrator: 'Cultural shift' needed

Richard Curphey serves as the administrator of West Ridge Care Center in Cedar Rapids, which provides skilled and long-term care as well as short-term rehabilitation.

While the facility boasts a four-star CMS staffing rating, providing more than 4 hours per day, per resident of total nursing-staff time, Curphey said West Ridge still struggles to maintain staffing levels due to nurse shortages.

He said West Ridge faces staffing challenges particularly on second shift, and has to rely on some agency staffing to fill CNA and nursing positions.

"We've made the commitment that we will staff where we need to be," Curphey said. "Now, I'm at that point, I think, come June if everything holds, we won't need to use agency staffing."

Hiring a contract travel nurse costs the facility anywhere from $80 to $95 an hour, compared to the $34 to $45 an hour West Ridge pays its nurses, he said.

Curphey highlighted the need for a cultural shift in the industry to make it more attractive to potential employees. He emphasized the importance of improving working conditions and providing support to nursing home workers, rather than relying on staffing mandates and regulations.

He raised concerns about tying Medicaid reimbursement rate increases to direct care worker pay, suggesting more creative solutions are needed. He also emphasized the importance of promoting nursing as a good career path, highlighting the challenges faced by nurses and the rewards of the job, including making a difference in people's lives and having a fulfilling career.

Fran Mancl is a former certified nursing assistant who left the profession after working more than 30 years in Iowa nursing homes, including 25 years at a Dubuque nursing home. Before his retirement in 2021, he said his nursing home increasingly relied on temporary staffing during the pandemic.

Mancl said temporary certified nursing assistants and nurses could not provide the same level of care as permanent staff because they weren't familiar with residents, their care plans and facility protocols. Despite that, they were paid much more than more tenured full-time staff at the nursing home, he said.

He said one certified nursing assistance placed at the nursing home through a staffing agency made $23 an hour to his $17 an hour.

"I can't blame CNAs who leave a facility and join a staffing agency, doing this to earn more money," said Mancl, who for 12 years worked full-time as a CNA and part-time at a call center to make ends meet.

"I had a passion for the job. I really felt direct care gave purpose and meaning to my life," he said. "But the pay wasn't adequate to make a living and be able to retire.

" … You're never going to level the playing field for recruitment and retention of direct care workers unless there's an honest, sincere and genuine investment in the worker," Mancl said.

'They deserve better'

Di Findley, executive director of the direct care worker advocacy organization Iowa Caregivers, said chronic low wages mixed with the rising cost of living continues to be a prominent driver for high turnover among direct care workers.

Nearly 80% of direct care workers in Iowa who were seeking new jobs were doing so for better wages, according to a wage issue brief published in March by Iowa CareGivers. And 28% held more than one job.

In 2022, the estimated median hourly wage was $14.42 for nursing assistants and $13.89 for home health aides.

Low wages are also a prominent factor for registered nurses, certified nursing assistants and other health care staff, Findley said, contributing to turnover rates for those professionals.

Iowa nursing homes reported a 72% turnover rate among certified nursing assistants in 2023, according to the brief. It was 52% for registered nurses and 43% for nursing home administrators.

That turnover rate is estimated to have cost Iowa nursing homes more than $123 million, the report states.

"When you think about these staffing agencies, you can't blame the workers if they can make more money and work more flexible hours," Findley said. "But, to impose some kind of mandate or restrictions on one segment of the business community and no mandates on the other side of that issue, we just feel there needs to be accountability there.

"Until wages are linked to the Medicaid reimbursement rates, and there's some way of reporting that and ensuring that's where the moneys are going," staffing issues will persist in Iowa's long-term care facilities, she said.

While Iowa has invested $15 million in registered apprenticeships for high-demand health care workers and provided free training for certified nursing assistants at some community colleges, a major investment in retention is also needed to ensure a stable and well-prepared direct care workforce, Findley said.

Iowa CareGivers said it will push lawmakers next year to provide funding to Iowa Workforce Development and University of Iowa to conduct an extensive analysis of direct care worker wage and benefit data, further increase Medicaid reimbursement rates and ensure additional funding goes toward raising wages.

"When you think about the cost of turnover within this workforce, and then their reliance on tax-supported assistance, when will it ever make sense that we invest in this workforce up front instead of paying out million and millions and millions of dollars each year in other, counterproductive ways?" Findley said.

Direct care workers — regardless of the workplace setting or the population served — provide vital services to Iowans of all ages and abilities, and deserve to be paid commiserate to the importance, skill and demanding nature of the work that they do, Findley said.

"They deserve better," she said.