Nursing Home Employee Turnover Data Transparently Reported

April 8, 2024
Richard Finnegan
Articles

“As part of its commitment to improve transparency and help families and caregivers find the best quality of nursing home care for their loved ones, the Centers for Medicare & Medicaid Services (CMS) will begin posting for the first time ever, staff turnover rates and weekend staff levels for nursing homes on the Medicare.gov Care Compare website today.”[i]

More on nursing homes in a minute…but let’s first consider if this same command rippled through all healthcare. What if all hospitals, clinics, urgent care, dialysis centers, and more had to report their cost of turnover in their financials by applying an agreed-up dollar figure to their data. Then board members, and even the public, could see the dollar cost of turnover on an organization’s financial reports and use it to assess and set concrete goals for improvement.

The Dollar Cost of Turnover is Rarely Reported

How important is this? Many finance professionals in publicly traded companies start their days by opening their computers to the standard run of finance reports, looking for ways to save money or generate more revenue…all while millions of dollars are going out the door due to turnover. Why? Because dollars associated with turnover are not reported, not budgeted, not visible in any financial reports anywhere. Not to the boards of directors, not to Wall Street, not to current shareholders nor to potential buyers of your stock.

The same is true for small businesses, privately-held businesses, and non-profits. Seriously, pause for just a moment. How can any chief financial officer say her standard financial reporting presents a total picture of her organization’s financial performance if it doesn’t account for the dollar cost of turnover?

The True Dollar Cost of Turnover is Often Shocking

Finance and accounting pros are in a constant search for quarters in the couch compared to the millions in dollars in cost of turnover often overlooked or simply not accounted for.

Several years ago, I worked with an aerospace company that made rockets…and invited the CFO to participate in a turnover cost study. We ultimately agreed the cost of losing an engineer was $121,450. We talked after the meeting and I suggested his company’s total cost of turnover was likely a top-5 cost, competing with the costs of facilities, materials, and people. He called the next day and said he couldn’t sleep, had gone to work early to extrapolate some numbers…and determined turnover was his second-highest cost. How is that for a reality check!

Do you know your dollar cost of turnover?
Use our free Turnover Calculator to determine the
specific financial impact of turnover for your organization.

Turnover Data Incorporated Into Nursing Home Reporting

But let’s return to this great service our government is providing us by reporting nursing home staffing and turnover statistics. Go to https://www.medicare.gov/care-compare/?providerType=NursingHome and then follow the prompts to enter the name of any local nursing home to reach this incredible information as you imagine that you are trying to find the best nursing home for a loved one. The first data presents overall staffing rating on a five-point scale, and then each of the following data points compared to the national average:

Total number of nurse staff hours per resident per day
Resident nurse hours per resident per day
LPN/LVN hours per resident per day
Nurse aid hours per resident per day
Total number of nurse staff hours per resident per day on the weekend
Physical therapist staff hours per resident per day
Registered nurse hours per resident per day on the weekend

And then you will find specific data relative to turnover:

Total nursing staff turnover
Registered nurse turnover
Number of administrators who have left the nursing home

This same report contains the following makes-sense quote that contains a clue as to these data’s importance:

CMS has explored the relationship between staff turnover and quality of care and a preliminary analysis indicates that as the average staff turnover decreases, the overall star ratings for facilities increases, suggesting that lower turnover is associated with higher overall quality.

Turnover Data Impacts Ratings AND Revenue

The star ratings mentioned here refer to each nursing home’s being assigned one to five stars based on metrics related to health inspections, staffing, and quality measures. Each star rating computes to dollars as these ratings are used by regulators, consumer, practitioners, insurers, lenders, and investors, as well as some designated Medicare payments.[ii]

So who is taking the lead to initiate reporting and financial accountability for each organization’s employee turnover? Our U.S. government is. Let’s see if other healthcare organizations will be next up to repair the gaping hole of not reporting turnover’s costs.

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