AACN Issue Bulletin
March 1996

Since its creation in 1965, Medicare has reimbursed hospitals for a portion of the clinical, classroom, and other costs to train nurses, physicians, and other health personnel with the aim of delivering quality inpatient care to Medicare recipients. Indeed, at $175 million annually, Medicare is the largest single source of federal support for training the largest health profession -- registered nurses. However, 70 percent of every Medicare dollar for nursing education goes to hospital diploma programs that produce less than 10 percent of all RNs. Moreover, those programs are concentrated in three states that received nearly half (48 percent) of Medicare funds for diploma nursing education in 1991, according to a recent study in the Journal of the American Medical Association. In addition, diploma training is geared to the needs of a dwindling inpatient population and fails to meet the more sophisticated requirements of current-day patient care, claim educators who are seeking to redirect Medicare funding to instead prepare nurse practitioners (NPs), certified nurse-midwives (CNMs), and other RNs with advanced practice skills.

Expanding the Primary- and Acute-Care Pools

Prepared mostly in master's-degree programs, advanced practice nurses also include clinical nurse specialists and certified registered nurse anesthetists. Using Medicare to support the education of APNs makes sense for a health system so concerned with the competing interests of quality and cost, many policymakers say. Further, they add, that support would aid the preparation of nurses in greatest demand by Medicare patients, such as nurse practitioners and clinical nurse specialists to deliver primary care, manage chronic health conditions affecting older people, and educate patients on how to avoid injury and the expense of hospitalization and nursing home care. Even within hospitals, the growing ranks of acute-care nurse practitioners not only are coordinating and providing direct care for inpatients and following those patients post-discharge, but are carrying out roles once reserved for medical residents, such as diagnosing and treating acute health problems.

In a 1994 report, the Pew Health Professions Commission called for doubling the number of nurse practitioner graduates by the year 2000 to offset the shortages of primary care physicians in major metropolitan centers, rural sites, and inner cities. Moreover in fall 1995, in an effort to further balance the nation's nursing pool, the commission urged dramatic reductions in the number of diploma and associate-degree training programs for RNs. Although it stressed that registered nurses should be prepared at different educational levels to fill different roles, the commission recommended that up to 20 percent of diploma and associate-degree programs should be closed in favor of expanded numbers of master's-degree nurse practitioner programs and increased federal support for NP students. Continued proliferation of two-year associate degree programs will not "adequately address the potential opportunity and enormous demands that will be placed on nursing in the future," the Pew Commission noted. In particular, the commission projected "important gains by nursing in primary care settings as nurse practitioners and nurse midwives are permitted wider ranges of practice and RNs move into community and ambulatory care settings."

Changes Seen Locally

OTA also found that certified nurse-midwives manage normal pregnancies safely and as well or better than do physicians. Moreover, after controlling for patient risk, a recent analysis of 15 studies published in Nursing Research and funded by the American Nurses Association found that CNMs used fewer medications and less fetal monitoring, induced labor less frequently, and achieved fewer low-birthweight deliveries than did physicians.

"A lot of what we're doing is pilot programs. If insurers like what they see, they'll come on board," says Susan Houston, director of outcomes management and research at St. Luke's Episcopal Hospital in Houston, Texas. In one program, a hospital nurse practitioner is helping congestive heart failure patients avoid readmission with in-home visits that include exercise, education on medication use, and access to other community resources such as Meals on Wheels. Why did cardiologists readily agree to nurse practitioners providing these patients with in-clinic and at-home care?

"They had a mutual understanding [with the nurses] and an acceptance that these patients often didn't need to be in the hospital, that it drives up costs," Houston says. "Sometimes these patients are not as severely ill as one might think." Often treatment requires only that medication be adjusted, "which can be done on an outpatient basis," Houston says.

Under St. Luke's outcomes management program, advanced practice nurses work to control patient and hospital outcomes by identifying the best practices. Each of the hospital's seven clinical nurse specialists and three nurse practitioners heads a collaborative practice team. "Each one has to get a multidisciplinary team together and determine the processes that drive the outcome," Houston says. APNs at St. Luke's need an interdisciplinary perspective "so they know how a respiratory therapist, physician, or physical therapist thinks."

One initiative, set up by a clinical nurse specialist, has reduced stays for hip and knee replacement surgery from six days to three with visits by nurses who check patients' homes for safety, ensure that caretakers are available and capable, and encourage patients to attend classes on how to prevent falls and mind other safety concerns. Since its inception a year-and-a-half ago, no falls, readmissions, or infections have been reported for the program's 80 patients.

After St. Luke's physicians opposed frequently used treatments at other hospitals that produced fast discharge of coronary artery bypass graft patients, such as with short-acting anesthetics or steroids to promote quick healing, clinical nurse specialists developed an alternative plan of care. "When they left [other facilities], these patients would return home and often crash," Houston says. But by selecting lower-risk patients, using techniques such as "active awakening" (talking patients through removal of a breathing tube), mobilizing them earlier, and with better timing of pain medication, St. Luke's CNSs have reduced these patients' stays from an average of eight days to four or five and cut recovery-room time from two days to one.

Support for APN Care Grows

Other recent studies report similar findings. Although physicians provided 66 percent of visits during one period in 1994 at Harvard Community Health Plan, an HMO in Boston, Massachusetts, only 28 percent required the services of an MD, according to an analysis by plan managers in the journal HMO Practice. More than half (52 percent) of plan physicians said their visits could have been handled by nurse practitioners or physician assistants. "It may be possible to increase the use of NPs and PAs if we can educate members, particularly younger women, about the role of NPs and PAs so as to encourage their preferentially selecting these practitioners for their routine care," the authors wrote.

Another Massachusetts HMO found that the average cost of nursing home patients was 42 percent lower when care was provided by a team of a physician and geriatric nurse practitioner (GNP) than by an MD alone. According to a 1992 study in HMO Practice, each patient of a GNP-MD team at Worcester-based Fallon Healthcare System cost $3,460 per year compared to $5,993 for patients receiving physician care alone. Savings stemmed mostly from lower emergency room use, fewer hospital transfers, and shorter hospital stays. Moreover, the authors report, costs were kept trim largely because patients received "good episodic care" by nurse practitioners on site and were followed so closely by GNP-MD teams that fewer referrals to specialists were needed. Fallon's savings of more than $217,000 more than offset the salaries of the three GNPs, whose fee-for-service practices also generated an additional $30,000 in revenues.

Across town, nurse practitioners not only are performing initial history and physicals on general surgery patients at Worcester's Med Center hospital, but in the neurosurgery unit, saved the hospital approximately $25,000 per year in treatment of back surgery patients, according to a report in the journal Nursing Economics. Standing orders for physical therapy consultations were eliminated when a nurse practitioner, reviewing patients' charts, noticed that nurses already had provided patients with bed mobility and other exercise instructions normally given by physical therapists. Adding nurse practitioners to the surgical team "is not another layer of health care workers doing tasks," the authors say, but is part of the process of re-inventing health delivery "to focus on patient outcome rather than the activity of the health care provider."

Securing Change Legislatively

With the failure of the 103rd Congress to pass health care reform legislation, efforts by the American Association of Colleges of Nursing and other organizations are focused on redirecting Medicare funds for diploma education into APN programs. Medicare funding is on-going and not subject to the uncertainties of annual appropriations decisions, AACN points out. In addition, such a redirection would require no new money and allow for additional clinical faculty to expand the number of APNs in training, thus helping to eliminate the waiting lists that all graduate nursing programs are experiencing. Indeed, AACN adds, Medicare reimbursement would give practice sites an incentive to take on additional students for clinical training, particularly as the numbers of specialty physician residencies likely are reduced.

AACN has won backing for the redirection from other organizations, including the Association of Academic Health Centers and the American Association of Nurse Anesthetists. Supporting APN education with Medicare dollars also has been urged by the advisory Tri-Council for Nursing which, together with AACN, includes the American Nurses Association, American Organization of Nurse Executives, and National League for Nursing.

With federal estimates suggesting the nation currently needs an additional 100,000 primary care providers to meet desired levels, AACN has recommended that 70 percent, or 70,000 of these providers should be nurse practitioners and certified nurse-midwives. To help generate that supply, AACN not only has called for an infusion of Medicare monies into APN education, but is urging that Medicare dollars -- now restricted to hospitals and other inpatient facilities -- also be channeled to clinical training of advanced practice RNs at community clinics, HMOs, nursing-school-operated nursing centers, and other primary care settings that deliver care to Medicare recipients.

Moreover, AACN is pressing for passage of the Senate's seven-year Budget Reconciliation Act, which would extend Medicare reimbursement for nurse practitioners beyond the current rural-area limitation to all outpatient sites, regardless of location. The move would not only boost patients' access to needed primary care, AACN says. It also would supply additional funds to support nursing schools' nurse-managed clinics that already are servicing Medicare patients.

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