Nursing is a practice discipline and occurs as 1 nurse and 1 patient, family, or community at a time. The encounter between a nurse and patient forms a fundamental bond that defines, not only nursing as a profession, but each individual nurse as a provider of care. Nursing practice drives value, and nurses have a direct and intimate influence on the quality, safety, and costs of patient-centered care. If we define nursing value as the function of outcomes divided by costs,
1there is a need to better define the measures and analytics for patient-level costs and outcomes of nursing care. This fundamental shift to capture the patient or consumer impact of nursing care is an important expansion of how nursing value is quantified. This will require rethinking how we view nursing care delivery beyond solely measuring nursing in terms of tasks or ratios and staffing levels, to one that recognizes the individual and collective accomplishments and results provided by each nurse across the broad spectrum of care. True nursing value can only be described by measurement of the clinical and financial impact of nursing care.
- Pappas SH
Value, a nursing outcome.
Nurs Adm Q. 2013; 37: 122-128
Performance-Based Nursing Care
This article raises a provocative question: should we focus our attention on the care provided by individual nurses? Current quality and safety activities examine unit or hospital-level outcomes for many nurses and many patients, for example, the rate of pressure ulcers or patient falls per unit or department each month. There is certainly a need to minimize these errors; however, there is little scrutiny on the care provided by individual nurses and whether patient care needs are identified and met. In a recent Time Magazine article, Steve Brill recommended each physician be subject to pricing and service delivery standards.
2This approach links the practice of medicine to the actual cost of the services delivered to patients. If nursing care was linked in the same way to both the quality of the services provided and the outcomes and costs of care, would that provide the necessary incentives to improve overall nursing care delivery and impact the cost of 1 of the largest components of the healthcare sector?
- Brill S
What I learned from my $190,000 open-heart surgery.
Time Magazine. 2015; January 19: 36-43
Should there be greater incentives for nurses in a pay for nursing performance (P4NP) arrangement? The question gets to the heart of what nurses do for patients. New measures of nursing performance must be clinically and operationally meaningful. One option is to adopt the recently announced Choosing Wisely program by the American Academy of Nursing.
3The proposed 5 items address key aspects of hospital nursing care such as getting older patients mobile and minimizing use of fetal heart rate monitoring (Box 1). Other metrics could be used in other clinical settings such as coordination of care, surveillance of the patient over time, pain management, and patient education. Consider surveillance and pain management. Both begin with an assessment of the patient or family then clinical judgments by the nurse determine optimum treatments or interventions. For example, in a hospice setting, 1 goal would be to minimize pain and discomfort but also to allow family members to interact with the patient. How often does a nurse assess pain and comfort and utilize pharmacological and other interventions? There is very little research on how nurses use pro re nata (PRN) narcotics or the practice differences in medication administration across nurses over time.
American Academy of Nursing: Five Things Nurses and Patients Should Question.
Choosing Wisely: 5 Things Nurses and Patients Should Question
- 1Don’t automatically initiate continuous electronic fetal heart rate monitoring during labor for women without risk factors; consider intermittent auscultation first.
- 2Don’t let older adults lay in bed or only get up to a chair during their hospital stay.
- 3Don’t use physical restraints with an older hospitalized patient.
- 4Don’t wake the patient for routine care unless the patient’s condition or care specifically requires it.
- 5Don’t place or maintain a urinary catheter in a patient unless there is a specific indication to do so.
Adapted from AAN.
American Academy of Nursing: Five Things Nurses and Patients Should Question.
It is increasingly possible to measure many aspects of patient-level nursing care through existing data in the electronic health record (EHR) and compare and contrast across settings, across patients, and across nurses.
4New metrics could include how often pain was assessed, the frequency of PRN narcotic use, and how often and when a patient was reassessed and how well a nurse manages pain, for example, decreasing pain scores. Summary data could be compared across multiple nurses to allow benchmarking of best practices to determine the pattern of pain management and narcotic PRN doses across different patients and nurses. Which patients experience the most pain, and what are the alternative interventions provided by nurses? What are some of the potential negative quality measures from pain intervention, e.g., constipation and bowel impaction through use of opioids? How do we incorporate this knowledge into competency development? These questions can be answered with data and excellence in nursing practice and could be rewarded in a pay for performance model possibly tied to value-based purchasing.
- Harper EM
The economic value of health care data.
Nurs Adm Q. 2013; 37: 105-108
In a value-oriented approach, the practice of nursing care is examined in relationship to the results for example improving quality of life or quality of dying rather than nursing tasks and their associated time. This raises compelling questions about poor nursing performance. For example, nurses with significantly fewer pain assessments or higher usage of narcotics compared to the practice setting norms could be identified and competency addressed. Existing data systems can be programmed to extract and summarize these data in near real time environments so that information can be provided to nurse managers and leaders in a timely manner.
The Curious Case of Nursing Costs
There are a number of issues that hide the contribution of nurses to patient care. First, patient-level nursing costs are unknown. At best, nursing care is expressed as average hours and costs per patient day in acute care. In other settings, care delivered by nurses is subsumed within other operational costs such as a clinic appointment or home health visit. This averaging approach hides clinically meaningful variation in nursing care delivered to each patient such as the time and expertise expended by each nurse relative to the services provided, as well as the identification of problems, interventions. and outcomes assessed and treated. Essentially, nursing care is invisible within the healthcare finance system. Traditional staffing-based metrics or nurse-to-patient ratios are outdated and inconsistent with the healthcare reform vision and value-based purchasing. The argument is that in order to better understand nursing value, we need to understand the relationship between individual nurses and patients, and develop ways to measure resources expended for each patient, including the patient-level time and costs for nursing care as a component of the total direct cost for a patient or consumer during an episode of care.
How will nursing care be viewed within emerging bundled payment schemes? Nursing time and costs vary by patient, across different care settings, and within individual patients, but there is no link between actual care, billing, and reimbursement. Hospitals and other healthcare settings that do not know their true patient-level nursing time and costs are at a distinct disadvantage in emerging payment models. The intent of healthcare reform is to optimize efficiency, productivity, and quality and reduce overall costs, and it is difficult to make optimum business decisions under these circumstances without good information. Developing accurate patient-level measures of nursing care time and costs will allow nurses and other healthcare leaders to evaluate and monitor nursing care in a more comprehensive manner. For example, will an elderly patient recovering from surgery for a femur fracture benefit from an extra day in the hospital or early transfer to a skilled nursing facility for rehabilitation services? If the cost of an extra day in the hospital is lower than the costs of a day of stay in a rehabilitation setting, it makes sense to extend the hospitalization, all other things being equal. It will be necessary to have both patient-level nursing cost and direct care hours as well as data for each day of stay to support such a value-based decision-making model. If nursing care is solely seen as an expensive labor cost that needs to be controlled, it will be difficult to make a business case for nursing care. In a value-based approach, nursing care and individual nurses are matched to patient need. Some patients may receive more nursing care, which would increase the cost of nursing care for that patient, but reduce overall costs by decreasing adverse events, length of stay, and hospital readmissions.
There are a number of ways to decrease nursing costs without affecting quality and safety. Nursing care delivery systems can be more efficient, effective, and productive, as well as higher performing.
5Future nursing care performance metrics will be based on the aggregate performance of each nurse and mimic the emerging metrics for physicians and providers within the value-based purchasing model.
- Welton JM
Nursing and the Value Proposition: How information can help transform the healthcare system. Proceedings of the Conference: Nursing Knowledge: Big Data Research for Transforming Health Care.
Date: August 12-13, 2013
6The nursing profession needs to develop valid and reliable metrics of individual nurse performance and benchmarks for aggregate performance within a work unit (e.g., an inpatient medical/surgical unit, home healthcare agency, etc.). It will also be necessary to identify the contribution of nursing care within multidisciplinary teams linked directly to each patient.
- Jha AK
Time to get serious about pay for performance.
JAMA. 2013; 309: 347-348
All nursing care resources and associated costs should be allocated to individual patients as units of service and not expressed as average hours or costs (e.g., abandon the traditional nursing hours and costs per patient day or per visit) and across the entire episode of care.
- Kaplan RS
- Anderson SR
Time-driven activity-based costing.
Harv Bus Rev. 2004; 82: 131-135
8Every place that nursing care occurs should allocate direct time and costs of each nurse to each patient as unit of service, whether this is in a hospital, delivered by a hospice nurse to a patient at home, or in an encounter with an ambulatory patient through a care coordinator interaction. Future nursing finance models should report nursing care across all settings as a composite; for example, all the “touch points” of nurses during an episode of care—ambulatory, acute, or post-acute. Financial accounting of nursing services should include patient-level costs per unit of service, which could be per patient day (inpatient), per case, per diagnosis-related group or other relevant code indicating the nursing care problems or diagnosis. Advanced metrics will allow comparison across providers and settings such as direct care time and cost variability of providers within a setting, and across different hospitals, rehabilitation facilities, home healthcare, clinics, hospice, and so on to determine the total cost of nursing care per bundled payment.
- Kaplan RS
- Porter ME
How to solve the cost crisis in health care.
Harv Bus Rev. 2011; 89: 3-18
What would this look like in a typical patient-centric model of value-based care? Direct nursing care time and costs are derived from EHR data that links a nurse directly to a patient and can calculate the actual direct care hours of care delivered to any patient. The actual wage of the nurse (or a suitable standard cost) can be used to calculate actual dollars expended for direct care. This allows measurement of a range of new nursing financial analysis such as total care time and costs per episode or hospitalization, time and cost variability by patients and diagnosis, as well as real direct nursing care time and cost per patient day, and ultimately, total patient cost, which is impacted by nursing interventions (Table 1). This approach begins to quantify some of the invisible activities of nursing, such as surveillance, that are critical to positive clinical outcomes and difficult to describe and justify in the current financial model that measures nursing in terms of tasks. These data can then be used to benchmark time and expenses for groups of patients, trend over time, and identify patterns of care such as nursing care time (intensity) and cost outliers. The primary emphasis is to identify best nursing care quality and performance within and across different care settings.
Table 1Nursing Finance Metrics
|Measure||Description||Unit of Analysis|
|Direct care RN hours and costs per encounter||Productive hours and costs||Patient-level encounter (shift, visit, appointment, etc.)|
|Direct care all nursing personnel hours and costs per encounter||Productive hours and costs||Patient-level encounter|
|Direct care compensation (other related labor costs such as shift differential, weekend or holiday pay, etc.)||Additional direct care labor costs||Patient-level encounter|
|Direct care RN hours and costs per episode||Episode can be a hospitalization, group of home or clinic visits, nursing time and costs per member per month, etc. Calculated as the sum of patient encounter direct nursing time and costs.||Patient-level episode|
|Summary patient-level costs||Episode direct costs (nursing, lab, radiology, pharmacy, etc.) inclusive of all costs accumulated across an episode of care.||Patient-level episode|
|Direct nursing care hours and costs||Direct nursing hours and costs||Cost center|
|Indirect nursing care hours and costs||Nonassignable nursing care hours and costs. Examples include vacation, education time, sick leave, etc. These time and costs plus benefits from above are allocated proportionally to all patients|
|Indirect nursing care—related benefit costs (insurance, disability, FICA contribution, etc.)||Benefit costs||Cost center|
|Patient-level nursing care hours and costs by DX or DRG||Sum of patient-level nursing time and costs per case||Patient-level episode by DX or DRG over time; trends by month, quarter, or year; and benchmark within and across care settings|
|Nursing direct care time and costs by day of stay||
||Actual time and costs for each day of stay, aggregated by patients settings, this can be measured as variability in nursing time/cost per visit or per member per month|
|Productivity||Cost center direct nursing care hours or costs by total nursing care hours or costs||Cost center % and trend by month (or quarter, year), benchmark within and across care settings|
|Nursing skill mix hours and costs per encounter or episode||Percent of RN or LPN and other unlicensed nursing personnel hours and costs, e.g., per shift or hospitalization in acute care, by clinic or home visit, etc.||Patient % by setting and by encounter, episode, or cost center and diagnosis. This can be a patient-level analysis or cost center analysis|
|Nurse wage and experience mix||Patient level analysis of direct care time and costs by nurse demographics||Patient encounter and episode of care, e.g., % of hours by novice vs. experience nurses|
|Unit-level analysis of direct care time and costs by shift||Unit-level analysis of experience mix and wage trends by month, quarter, or year|
DRG, diagnosis related group; DX, diagnosis; LPN, licensed practical nurse; RN, registered nurse.
* Direct nursing care time and costs are the actual hours a nurse spends with a patient within an assignment, clinic appointment, home health visit, etc., and associated costs.Direct care hours and costs can be used interchangeably with productive hours and costs.
† fIndirect care hours and costs are not directly assignable to an individual patient, for example vacation time and costs. They are typically allocated as an average across patients.Indirect hours and costs are used interchangeably with nonproductive hours and costs.
In a value-based nursing model, nursing care is viewed as a collection of nurses as individual providers within a practice setting and is encounter focused to identify the relationships between an individual nurse and patient (or family, community) and the services provided. Value-based nursing is data driven and incorporates care outcomes and nursing performance. Each nurse is accountable for the care he or she provides, but all nurses who care for a single patient are collectively accountable for the results of the combined team effort. Nursing care value needs to be measured in ways that are understandable, actionable, and meaningful. The notion that nursing care quality is the absence of adverse events is ultimately self-limiting. A hospital or other nursing care setting may have zero infections, falls, pressure ulcers, or other preventable harm sensitive to nursing care, but does this indicate high value? This is indeterminable unless the financial impact is also measured.
Lastly, viewing nursing care as essentially a cost that needs to be managed or reduced is an archaic economic model that commoditizes nursing in the same way we measure pounds of laundry or liters of oxygen as supplies or hospital services. To achieve a value-based nursing care model, we need to view nursing as a practice and nurses as individual providers of essential services that have both a clinical and financial impact. Metrics that measure nursing value should be based on what nurses accomplish, the ultimate results of nursing care in collaboration with all members of the healthcare team and not solely the actual process of care. The value nurses brings to our reforming healthcare environment is essential.
- Value, a nursing outcome.Nurs Adm Q. 2013; 37: 122-128
- What I learned from my $190,000 open-heart surgery.Time Magazine. 2015; January 19: 36-43
- American Academy of Nursing: Five Things Nurses and Patients Should Question.Accessed January 11, 2015.)
- The economic value of health care data.Nurs Adm Q. 2013; 37: 105-108
- Nursing and the Value Proposition: How information can help transform the healthcare system. Proceedings of the Conference: Nursing Knowledge: Big Data Research for Transforming Health Care.http://www.nursing.umn.edu/prod/groups/nurs/@pub/@nurs/documents/content/nurs_content_452544.dot(Accessed January 11, 2015.)Date: August 12-13, 2013
- Time to get serious about pay for performance.JAMA. 2013; 309: 347-348
- Time-driven activity-based costing.Harv Bus Rev. 2004; 82: 131-135
- How to solve the cost crisis in health care.Harv Bus Rev. 2011; 89: 3-18
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