Staffing Mandates Boost Care Without Closing Nursing Homes

Key Takeaways

– Staffing mandates didn’t cause nursing homes to close. Across 6,900 facilities, higher minimum staffing raised staffing levels without triggering shutdowns.

– Staffing mandates didn’t drag down profit margins. Added labor costs (~$273K) were offset by higher net revenues (~$546K).

– While industry and much of Congress have opposed staffing mandates, higher staffing saves lives and doesn’t harm nursing home finances, research shows.

For years, the nursing home industry has sounded the same alarm: Force us to hire more staff and facilities will close. A new study published March 3 in Health Affairs finds little evidence to support that argument.

The research, which examined nearly 6,900 nursing homes across 22 states over 14 years, found that minimum staffing mandates raised care levels without triggering closures. Rather, they increased net patient revenues by about $546,000 annually. That increase offset roughly $273,000 in additional labor costs.

“The financial doom that the industry predicted just didn’t materialize,” said LDI Executive Director and lead author Rachel M. Werner, MD, PhD. “The data show that these mandates don’t harm nursing homes, and they do help residents.” Werner is the William Maul Measey Professor in Health Care Management and Economics, Wharton School, and a Professor of Medicine at the Perelman School of Medicine.

About 1.2 million Americans live in nursing homes, most of whom require help with basic activities of daily living such as showering, toileting, eating, and dressing. Previous studies, as well as research from health policy and elder advocacy groups, have found that insufficient staffing leads to poorer outcomes, including pressure ulcers, infections, pain, greater use of antipsychotic drugs, falls, and other serious problems.

Minimum Requirements Rolled Back

In 2024, the Biden administration finalized a federal minimum staffing rule, establishing a national base of 3.48 total hours of direct care per resident per day. Industry groups immediately sued. In 2025, Congress delayed implementation by a decade through H.R. 1. However, the Trump administration has since moved to rescind the rule permanently, before it took effect. Werner submitted formal public comments opposing the repeal, citing her forthcoming study.

“The federal rule was an attempt to address a long-standing problem in nursing homes, that many nursing homes have staffing levels that are too low to safely care for their residents,” she said.

Modest increases in staffing levels could have a major impact on health. A memo Werner’s team prepared for U.S. Sen. Elizabeth Warren, D-Mass., projected that the federal standard could save about 13,000 lives per year and reduce serious adverse outcomes for tens of thousands of residents annually.

Nursing assistants provide 60% of all nursing hours, spending more than two hours of direct care per resident per day while supporting an average of 11 residents per shift, according to data from the research and advocacy group PHI. However, certified nursing assistant numbers have fallen 20 percent over the past decade, from 616,550 in 2014 to just over 492,000 in 2024, despite a growing need for these very workers.

“Direct care workers help residents with all of their personal care activities. All of those things really matter in a nursing home resident’s day,” Werner said.

The staffing increases in the new study were driven mainly by licensed practical nurses and nursing assistants. While the findings support the benefits of increased staffing, Werner said the increases in net revenue were a bit of a mystery. Possible explanations include payer-mix shifts toward higher-margin Medicare patients and states raising Medicaid daily rates. It could also be nursing homes freeing up capital previously obscured through related-party transactions. Werner cited a recent New Jersey case where hidden profits were “eye-popping.”

“This is just more evidence that we have very little insight into how the money flows,” she said.

A Nursing Home Workforce Crisis in Progress

The problem of maintaining an adequate direct-care workforce precedes, and will outlast, any single policy fight. It’s simple math: The population of adults ages 65 and older is projected to grow from 57.8 million to 88.8 million by 2060, with the population ages 85 and older cohort nearly tripling. Meanwhile, the working-age population will stay roughly flat.

Workers filling these care jobs already face extraordinary hardship. A majority (61%) of nursing assistants are people of color. The median annual income is just $30,586; 42% rely on some form of public assistance. Turnover approaches 100 percent annually, according to PHI data. These are jobs people often take when options are limited, Werner noted.

Now those options are being narrowed further by immigration enforcement. Immigrants comprise 28% of the entire long-term care workforce, Werner and former LDI Fellow Amanda Kreider wrote in a May 2025 STAT News op-ed. Werner and Kreider have active research examining immigration enforcement and the home health workforce decline. “We find that when there’s a crackdown on immigrants, the home health workforce declines,” Werner said.

“The simple solution is to pay nursing assistants more,” she added. “Make the jobs better and more desirable. Let people unionize. All of those things come with a price tag, and we just don’t seem to have the political will for that.”

The Medicaid Reductions Coming for Nursing Homes

Perhaps the most serious threat are the looming Medicaid cuts. Medicaid is the largest funder of long-term care, responsible for 66% of nursing home revenue. The reconciliation bill that passed in mid-2025 cut hundreds of billions of dollars from Medicaid. States facing tighter federal funding could freeze or reduce their daily reimbursement rates to facilities, which could directly affect worker compensation.

“That’s going to make it harder for them to pay workers,” Werner said. The cuts are not expected to hit in full until the fourth quarter of 2026, but the effects will ripple through facility budgets and workforce pipelines well before that.

Werner and LDI Senior Fellow Norma Coe are now researching wage pass-through laws. These are state mechanisms that direct supplemental Medicaid funding specifically to direct-care worker wages.

With the federal staffing mandate permanently repealed, state-level requirements are the only safety net for many residents. Eleven of the 22 states in the study had no staffing mandate at all during the 14-year window.

“We know higher staffing saves lives,” Werner said. “That’s not a controversial scientific finding. What’s controversial is deciding whether we as a society are going to require it.”

Senate Finance Committee Ranking Member Ron Wyden (D-Ore.) has introduced the Nurses Belong in Nursing Homes Act, which would restore minimum staffing requirements. It would also mandate an on-site RN 24/7, provide permanent funding for inspections and enforcement, and require nursing home owners to reinvest civil monetary penalties into workforce recruitment and retention. The bill faces stiff opposition from the industry and Republicans.