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Does organizing nursing home workforce in teams save costs?

Dana B. Mukamel - University of California, Irvine - Center for Health Policy Research

Shubing Cai & Helena Temkin-Greener -University of Rochester School of Medicine -

Department of Community & Preventive Medicine Funding: NIA grant # AG23077

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Team care is viewed as effective

• Especially for chronic and long-term care

• Better patient outcomes

• Lower error rates

• Better care coordination

• Better work environment

• Better staff outcomes

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Teams in nursing homes

• Interdisciplinary care planning–Mandated by CMS

In most facilities

• Daily care teams–Prevalence is unknown–Few studies, mostly convenience

sample

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Less is known about the cost implications of teams in nursing homes

• Physician / nurse practitioner teams were shown to be more cost effective than physicians aloneBurl JB, 1991; 1994 & 1998 and Aigner, 2004.

• Specialized wound teams have been shown to be cost effectiveVu T, 2007.

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Study objective:

• To examine the cost impact of daily care teams in nursing homes

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Daily care teams defined by the direct care staff in the nursing home as:

1.Formal teams: if staff assigned by management

2.Self-managed teams: if staff self-organized their daily work in teams

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Sample:

• 162 free standing nursing homes in New York State with at least 50 beds

• 7,418 direct care staff

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Data:

• Survey of direct care staff

• Medicaid cost reports

• Case mix data from the NYS DOH

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Methods:

Hybrid cost function:

• Weighted regression to account for under response by for profits

• Inference based on robust standard errors and joint F-tests for highly collinear terms

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Composition of daily care teams*

91

71 72

43 4336

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Disciplines included in the team

% C

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*Information based on the survey question: “Who else is on your team?” 46% of responders report meeting daily27% of responders report meeting at least weekly

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Sample (N=135) All NYS study eligible nursing homes (N=531)

Mean Standard deviation

Mean Standard deviation

Percent of direct care staff organized in formal teams

8.4 6.4 n/a n/a

Percent of direct care staff in self managed teams

7.4 5.5 n/a n/a

Annual variable costs ($1000) 20,135 17,949 17,988 16,896

Inpatient days 77,071* 48,273 68,709 40,942

Inpatient admissions 408 334 367 303

Average RUG scores 1.18 0.12 n/a n/a

Adult day care days 2,481* 5,041 3,530 17,125

Number of beds 215 136 196 113

Home health care visits 7,964 42,580 8,281 59,039

Outpatient clinics 1,083 7,572 499 4,720

Management hourly wage 43.35* 14.39 49.12 26.72

CNA hourly wage 18.29 4.70 19.04 5.29

Non-profit ownership (%) 66%* 51%

* Significant difference at the 0.05 level

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Independent Variables Coefficient P Value*

Beds 0.214 x 10-2 0.00

Case mix adjusted days/1000:

Linear 0.226 0.00

Squared -0.115 x 10-3 0.00

Cubed 1.76 x 10-7 0.00

Admissions 0.213 x 10-3 0.00

Adult day care days/1000 0.010 0.00

Home health care visits/10000 0.027 0.00

Outpatient clinic visits/1000 0.007 0.00

Log management wages 0.170 0.00

Log CNA wages 0.535 0.00

Non-profit facility 0.093 0.00

Constant 12.620 0.00N = 135R2 = 0.97* Based on robust standard errors.

Estimated annual variable cost function with probability weightsDependent variable: Log of variable cost

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Independent Variables Coefficient P Value*

% direct care staff in formal teams:

Linear 0.012 0.99**

Squared -2.332 0.76**

Cubed 11.956 0.49**

% of direct care staff in self managed teams:

Linear -0.487 0.67***

Squared 11.449 0.39***

Cubed -38.929 0.30***

** P value for the hypotheses that the linear, squared and cubed terms are jointly significant is 0.004.*** P value for the hypotheses that the linear, squared and cubed terms are jointly significant is 0.426.

Estimated annual variable cost function with probability weightsDependent variable: Log of variable cost

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Predicted variable annual costs as function of formal team penetration

(Based on the estimated cost function)

$15,000,000

$15,100,000

$15,200,000

$15,300,000

$15,400,000

$15,500,000

0% 5% 10% 15% 20% 25%

Percent of direct care staff organized in formal teams

Va

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Conclusions:

• Formal teams are a cost saving strategy

• The range of cost savings estimated at $174,000 per year

• Self-managed teams do not seem to have the same impact on cost

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Why are costs increasing at higher penetration levels?

• Higher quality?

• Pushing teams “too far”?

• Different team types? – more specialists