Acute care hospital units staffed by registered nurses (RNs) who have been with the specific unit for at least 1 year have significantly shorter patient length of stay (LOS) than units staffed by contract RNs or by

staff RNs who have been in the unit for shorter periods, according to a study published in the April issue of the American Economic Journal: Applied Economics.

Ann P. Bartel, PhD, director of the Workforce Transformation Initiative, Columbia Business School, New York City, and colleagues estimate that an increase of 1 year in average unit tenure of RNs was associated

with a 1.33% reduction in the adjusted LOS.

"These findings suggest a comparatively important role for specific human capital in the productivity of the registered nursing staff," the authors write. They estimate for a Veterans Affairs hospital with an average

RN unit tenure of 6.55 years, the annual net cost savings would be $20,976 compared with a unit with an average RN unit tenure of 2.25 years.

The researchers used monthly data from the Veterans Administration hospital system linking each patient to the nursing units in which he or she was treated to examine how changes in the nursing team affect

patient outcomes. The changes studied included when new nurses joined the team, when experienced nurses left it, and whether unit staff members were regular nurses or agency nurses contracted to cover for

regular staff absences. The use of monthly data limited the study to estimation of short-term effects (occurring within 1 month).

The authors included acute-care nursing units such as medical, surgical, neurology, oncology, cardiac care, and intensive care units. On average, 16 patients were cared for by a team of 3 RNs on a given shift (8

or 9 RNs per day), assisted by licensed practical nurses and unlicensed assistive personnel (commonly referred to as nursing aides).

Productivity was measured as hospital LOS, used as a proxy for the cost and quality of a hospital episode of care. The difference between actual and expected LOS was used to control for variations in illness

severity.

"The degree of specificity of the registered nursing staff's human capital is shown to be an important determinant of patient outcomes; while unit-level tenure is significant, the effect of a nurse's hospital tenure

outside of the unit is insignificant," the authors write. They also reported negative productivity effects when experienced nurses left nursing teams or new hires were added.

In addition, the authors found that higher staffing levels were associated with significant reductions in residual LOS, but that the effect varied with staff skill level. The association between a 1-hour increase in

staffing per patient bed day and decreased residual LOS was 3.4% for RNs, 2.9% for licensed practical nurses, and 1.5% for unlicensed assistive personnel.

Residual LOS was shortened by overtime hours worked by RN staff nurses, but not by staffing with contract nurses. The authors comment, "While the presence of a contract nurse adds to the intensity of staffing

of the unit, these additional resources are not productive on the margin in improving patient outcomes as measured by residual length of stay. We conjecture that the difference in coefficients for employee RN

hours (either regular hours or overtime hours) and contract RN hours is related to differences in the nurses' specific human capital. In comparison to staff nurses working overtime, contract nurses have no, or very

little, prior familiarity with the procedures, practices, and equipment in the unit as well as with their nursing colleagues."

The authors conclude, "We find corroborative evidence for this form of specific human capital: increases in the average tenure of registered nurses on the unit results in significant decreases in the length of time

patients stay in the hospital. In addition, we show that a nurse's unit experience is much more relevant than his or her hospital experience. Further evidence of the importance of specific human capital is the

finding that substituting contract nurses for regular staff nurses is associated with significant increases in patients' length of stay."

This study was supported by the Robert Wood Johnson Foundation and the Veterans Affairs Health Services Research & Development Service program. The authors have disclosed no relevant financial

relationships.

Am Econ J Appl Econ. 2014;6:231-259. Abstract