Politics, Economics, and Nursing Shortages: A Critical Look at United States Government Policies

Rob Elgie, BSN, RN, BC


Nurs Econ. 2007;25(5):285-292. 

In This Article

Nursing Workforce Policy: The Nurse Reinvestment Act

The most recent federal policy legislation aimed at the nurse supply shortage is the Nurse Reinvest ment Act of 2002. The NRA was implemented as a group of amendments to Nursing Workforce Devel op ment Programs already existing under the Public Health Service Act, Title VIII. The intent of the provisions in the NRA include "...nurse recruitment through public service announcements and expansion of the National Nurse Service Corps, nurse retention through internships, residency programs and career ladders, im proved retention by enhancing collaboration with other professionals, programs to increase geriatric nurse education, nurse faculty loan programs, and ‘magnet facility' patient safety grants to support greater provider and care activity coordination" (Premier, 2005).

In actual practice, the NRA consists of seven grant program categories (AACN, 2006). Two of the programs in the NRA are social programs that have little or nothing to do with increasing the nursing workforce. They are the Workforce Diversity Grants and the Com prehen sive Geriatric Education Grants. These grant programs may be appealing socially if they redistribute some of the nursing workforce from minority and disadvantaged categories of workers toward geriatric nursing care; however, there is no reason to believe they will increase the nurse supply overall.

The other five programs subsidize the education of nursing students in the form of grants and vouchers. Vouchers as a means to decrease the cost of supplying nurses require employment for a period of time following graduation but offer no guarantee of equitable pay, benefits, or working conditions (Andrews, 2004). In fact, vouchers exert downward pressure on nurse wages, benefits, and working conditions because the graduate nurses must work in designated facilities as a part of the voucher contract but have little or no power to negotiate compensation. Consequently, there is no economic incentive for those facilities to offer fair compensation because the supply of nurses is provided by government voucher contract.

Grants and vouchers may benefit individual nursing students by reducing their educational costs. Those who participate try to make the best choices they can based on each of their current microeconomic contexts in which they try to maximize their potentials in the market. That is to say no reasonable criticism can be made of the individual participants. Many have received and benefitted from subsidized nursing education. But nevertheless, education voucher programs do not offer economic incentives for nurses to remain in the nursing workforce or for the national workforce to shift on a macroeconomic scale toward nursing.

The only long-term solution to the nursing workforce shortage is economic equilibrium, defined as a balance between supply, demand, and price in a fair market (Baker, 2003; Browning & Zupan, 1999). Equilibrium in the nursing workforce has not and will not result from reducing the cost of supply through subsidies. Since 1964, the nursing workforce supply has been artificially sustained to varying degrees by grants, loans, and vouchers. The NRA is a continuance of such government policies that after more than 40 years obviously have not worked.


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