ARP Spending Plan Provisions Seek to Address Nursing Shortage

There is a longstanding shortage of nurses doing in-home care. Thousands of children in Pennsylvania rely on Medicaid-funded in-home nursing and are authorized for these services by their insurance companies, but they can’t find nurses to fill the shifts. The lack of coverage places a high burden on families who are missing work, not sleeping, kids are missing school, and sadly hundreds of kids in Pennsylvania are even living in institutions because of the lack of nursing. New funding available under the American Rescue Plan (ARP) seeks to address this crisis. 

In 2019, DHS convened a workgroup of consumers, nursing agencies, and Medicaid Managed Care Organizations (MCOs) to focus on solutions to the nursing shortage. That workgroup met for over a year, and came up with a set of recommendations around how to address the nursing shortage problem, ranging from paying nurses more, to increased case management for kids, to working with nursing schools to bolster the professional pool of nurses graduating from nursing school with an eye toward doing home care. Now in 2022, the American Rescue Plan (ARP) has made money available for states to use to enact measures that help expand access to home and community-based services like in-home nursing.

In June 2021, DHS submitted its ARP spending plan to CMS. The state received conditional approval to begin rolling out the spending measures in December 2021.  Two measures in particular aim to address the nursing shortage: 1) an initiative to establish medical home and pediatric complex care resource centers, and 2) incentive payment arrangements for nursing agencies. Below is a summary of each provision.


1. The Medical Home & Pediatric Complex Care Resource Center Initiative

The state plans to fund a medical home program to focus on comprehensive coordination of care for children with complex medical conditions that rely on in-home nursing. This pediatric shift nursing medical home model will be a subset of the Patient Centered Medical Home (PCMH) model that is already used in many primary care offices. DHS is currently in the process of identifying current PCMHs practices that are serving a high volume of children receiving in-home nursing services, so they can start implementing the shift nursing medical home model which has embedded in it a focus on case management for this population.

There are also new case management requirements for the physical health MCO Special Needs Units. These requirements were added to the 2022 HealthChoices Agreement. The new provisions require the SNUs at each MCO to 1) educate families on the Family Facilitator, which is a position housed in the Office of Developmental Programs (ODP) and dedicated to ensuring kids have opportunity to live in community placement w/ family; 2) help families register with the county; 3) lead discharge planning and ensure there is a long term goal of discharge to the community; 4) monitor kids living in facilities to ensure their care plan is being delivered; and 5) conduct visits with families to assess the home environment to facilitate discharge from the facility.


2.  Incentive Payment Arrangements

The second major component of the ARP spending plan that focuses on addressing the nursing shortage is a set of new incentive payment arrangements which will be made available to nursing agencies beginning January 1, 2023. These incentive payment arrangements include:

1) Shadow payments – payment for new nurse shadowing while training, which is something not currently available and which stifles the nurse’s ability to learn on the job.

2) Recruitment and retention bonuses – to help the nursing agencies get competitive with hospitals, where nurses are routinely getting sign-on and retention bonus payments.

3) Pay for Performance (P4P) - a payment structure where the payment a provider, such a nursing agency, gets a bonus for achieving certain metrics or outcomes related to quality of care. There is no downside to the provider in this arrangement; they can’t be penalized— only rewarded for good performance. P4P incentive payments will be made related to two areas:

  • Care Plan P4P, which will provide an incentive payment for carrying out and sticking to a child’s plan of care for nursing; and
  • Reduction in missed shift rates P4P, which will provide an incentive payment for nursing agencies that report low levels of missed or unstaffed nursing shifts.

PHLP is pleased the state is taking such proactive measures to address the nursing shortage and help increase access to these services for medically complex children. Families are encouraged to contact PHLP’s Helpline at 1-800-274-3258 if they are having trouble finding staff for in-home nursing services.