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Research Highlights

Pandemic loan program linked to increased staff hours in U.S. nursing homes

Nursing homes that received a Paycheck Protection Program (PPP) loan during the COVID-19 pandemic had increased staffing hours compared to facilities that did not receive loans, according to an NIA-funded study published in JAMA Network Open. The findings underscore the effectiveness of PPP loans and the need for sustainable programs that incentivize nursing homes to increase investments in frontline staff.

Nursing home staff member shares a laugh with a resident

The COVID-19 pandemic underscored several long-standing problems within nursing homes in the United States, including staffing shortages that threaten the quality of resident care. In May 2020, more than one in five U.S. nursing homes reported severe staffing shortages, most frequently due to providing insufficient work hours for nurse aides, licensed nurses, and other clinical staff. In response, states; federal entities; and the National Academies of Sciences, Engineering, and Medicine called for nursing home funding programs that appropriate a specified percentage of funds to staffing.

During the pandemic, the U.S. Congress enacted the PPP, a forgivable loan program that required recipients to appropriate 60%-75% of their loan toward staffing to qualify for forgiveness. For this study, a team of health policy researchers from New York University Grossman School of Medicine; Icahn School of Medicine at Mount Sinai; Yale School of Medicine; and University Medicine Associates, San Antonio analyzed the effectiveness of PPP loans to address whether funding programs that require investment in staff can ameliorate staffing shortages in U.S. nursing homes.

The researchers gathered data about funding sources, resident demographics, and care quality for 6,008 U.S. nursing homes. Approximately 30% of these nursing homes received a PPP loan. Nursing homes that received a loan were more likely to have a greater proportion of Medicaid-funded residents and poorer quality of care, based on metrics from Nursing Home Care Compare, a federal program that collects data on nursing home staffing, resident treatment, and health inspections. This finding suggests that the nursing homes most in need of funding received PPP loans.

Next, the researchers analyzed differences in staffing hours between nursing homes that received PPP loans and those that did not. They found that nursing homes that received a PPP loan increased staffing hours for certified nursing assistants (CNAs) and licensed practical nurses (LPs), but not registered nurses (RNs). The study authors hypothesize that nursing homes may have prioritized using funds to staff CNAs and LPs because they are less expensive than RNs — increasing their hours may have been the most practical way to employ the greatest number of staff possible with limited funding.

Overall, the results suggest that the PPP was linked to increased staffing hours for CNAs and LPs. However, nursing home staffing shortages existed long before the pandemic, and PPP loans were only temporary. As such, study findings emphasize the need for federal and state entities to institute longer-term support that incentivizes nursing homes to invest in frontline staff.

Reference: Travers JL, et al. Association of receipt of Paycheck Protection Program loans with staffing patterns among US nursing homes. JAMA Network Open. 2023. Epub July 27. doi:10.1001/jamanetworkopen.2023.26122.

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