Policy Incentivizing High Staffing of Nursing Homes May Improve Patient Health

THURSDAY, Jan. 22, 2026 (HealthDay News) -- A Medicaid policy that incentivizes high staffing levels in nursing homes is associated with modest improvement in patient health, according to a study published online Jan. 16 in JAMA Health Forum.Andrew Olenski, Ph.D., from Lehigh University in Bethlehem, Pennsylvania, and colleagues examined the impact of policies to raise staffing through payment reforms and staffing regulations on patient health by studying a recent Illinois payment reform aimed at increasing staffing at Medicaid-serving facilities. By providing facilities with bonus Medicaid reimbursements up to $38.68 per Medicaid resident-day based on acuity-adjusted staffing levels, the policy incentivized greater staffing. Two difference-in-differences models comparing changes in health outcomes before and after the reform were estimated against distinct control groups: high-Medicaid facilities in other states and low-Medicaid facilities in Illinois.The researchers found that both analyses provided some evidence that patient health was improved with the induced staffing increases. The 90-day hospitalization rates decreased by 0.51 percent for patients in Illinois relative to patients in other states after the reform, representing a reduction of about 4.1 percent of the mean. The estimates within states were broadly similar. Substantial improvements in independence in activities of daily living (ADL) were found in both analyses; however, these reductions could reflect strategic downcoding rather than real health improvements since bonus payments were based on acuity-adjusted staffing levels, allowing facilities to increase their payments by reporting residents as low acuity and requiring little ADL-related care."The financial incentive structure in this setting prevents us from distinguishing whether improvements to ADLs and other financially tied factors are truly health improvements rather than downcoding," the authors write.Abstract/Full Text.Sign up for our weekly HealthDay newsletter