In the United States, approximately 1.7 million adults are diagnosed with sepsis every year (Rhee et al., 2017). Persons with compromised immune systems, those with chronic medical conditions with functional impairment, and adults 65 years and older are at an increased risk for developing sepsis (Buchman et al., 2020). Sepsis is also the most common hospital admission with mortality rates of 75% among Medicare beneficiaries (Kramarow, 2021). Sepsis can lead to serious, life-threatening consequences and death. As the severity of sepsis and patient age increase, the mortality rate also increases (Paoli et al., 2018). It is estimated that approximately one-third of patients who die while in the hospital are diagnosed with sepsis (Buchman et al., 2020). Over 200,000 sepsis-related deaths were reported in the US in 2019, and 75% of those deaths affected older adults aged over 65 (Kramarow, 2021).

It has been reported that there are substantial increases in Medicare beneficiaries admitted to a hospital for the management of sepsis which has resulted in extended hospital lengths of stay (LOS) (Buchman et al., 2020a; Frank et al., 2021; Paoli et al., 2018). Moreover, patients hospitalized with sepsis often cannot be discharged home and require admission to long-term acute care or skilled nursing facilities. Patients with sepsis are two to three times more likely to be readmitted to the hospital with secondary complications than patients without sepsis (Farrah et al., 2021).

Hospital stays are among the costliest healthcare services provided in the U.S. In a 2017 analysis, the average private insurance payment rate was approximately $21,000/admission and the average Medicare payment rate was about $11,400/admission (Maeda & Nelson, 2017). As sepsis severity increases, a patient’s length of hospital stay also increases. Paoli and colleagues (2018) found the average LOS was 267% higher in patients diagnosed with septic shock than those patients diagnosed with sepsis. Longer lengths of stay place a tremendous human and economic burden on patients, families, hospitals, and the nation. The costs associated with the prolonged stay for sepsis treatment represent a considerable portion of the Medicare hospital payments that increased in the past years (Lagu et al., 2012; Maeda & Nelson, 2017; U.S. Department of Health & Human Services, 2020). The Agency for Healthcare Research and Quality has reported that sepsis is the most expensive clinical condition with aggregated annual hospital costs of $22.8 million (Liang L, 2006). Researchers also predicted that sepsis is the costliest of all patient diagnoses for hospital stays accounting for $45 billion annually, including both inpatient and skilled nursing facility costs (Buchman et al., 2020b).

Beyond the direct clinical economic impact of sepsis, it imposes a substantial financial burden on healthcare systems; however, this strain has been shown to present a business case for cost savings through strategic investments in nursing resources. Evidence demonstrates that adequate registered nurse (RN) staffing levels improve patient outcomes, including reduced LOS and adverse events, which in turn can significantly lower hospital costs. Needleman et al. (2006) found that higher RN staffing levels are directly associated with better patient outcomes and financial benefits, as fewer complications and shorter LOS translate into measurable savings. Similarly, a review by Griffiths et al. (2023) highlighted the cost-effectiveness of optimizing RN staffing and skill mix, emphasizing that these measures not only improve care quality but also enhance hospital efficiency. These findings underscore that RN staffing should not be seen simply as an expense but as a strategic investment, particularly in managing high-cost conditions like sepsis.

Previous research has uncovered a few factors associated with sepsis outcomes. Lasater et al. (2020) found that patients with sepsis who were treated in hospitals with higher RN staffing levels had lower mortality rates, readmission rates, and lengths of stay across New York State (Karen B Lasater et al., 2021). We too reported a link between improved RN staffing levels and an increase in sepsis prevention bundle compliance with a subsequent decrease in sepsis mortality (Cimiotti et al., 2022). Similarly, Dierkes et al. (2022) found that hospital RN staffing levels are more strongly associated with improved sepsis patient outcomes—including lower mortality, reduced readmissions, and shorter lengths of stay—than compliance with sepsis protocols, highlighting the critical role of adequate nurse staffing in sepsis care. These imply that hospitals that invest in adequate RN staffing and improved work environments are more likely to provide high-quality care to sepsis patients, resulting in better outcomes. In this study, we expanded the measurements of nursing resources by examining both RN staffing level and nursing skill mix and estimated the cost savings for hospitals given improved nursing resources. This study aims to examine how RN staffing levels and skill mix impact the length of stay for Medicare beneficiaries with sepsis and to estimate the associated hospital cost savings. By doing so, we also contribute to the literature on the business case for nursing, highlighting how investments in RN resources can lead to both improved patient outcomes and economic benefits for hospitals.

The characteristics of the 2,107 study hospitals are shown in Table 1. The average hospital LOS was 6.2 days (SD=1.7), RN HPPD was 8.84, RN skill mix was 77.29% and the average Sep-1 score was 56.01. Hospitals were small or moderately small with 250 or fewer beds (66.8%), non-profit hospitals (74.2%), located in metro areas (74.5%), high-technology hospitals (41.2%), and non-teaching hospitals (73.3%).

The demographic characteristics of the 653,496 patients diagnosed with sepsis are shown in Table 2. On average, patients were 78.1 years of age, 51.5% female, 5.0% transferred in from another acute care hospital, 46.4% admitted to an ICU and 10.0% died within 60 days of admission. Most patients (60.6%) had sepsis without organ dysfunction or no classification, followed by patients with severe sepsis (19.5%) and those with septic shock (19.9%). The most common comorbidities included complicated hypertension (78.5%), fluid and electrolyte disorders (62.8%), chronic pulmonary disease (33.4%), congestive heart failure (32.7%), and renal failure (30.71%).

The results of the zero-truncated negative binomial model are shown in Table 3 (full regression results are shown in Table 2, Supplement). Controlling for patient and hospital characteristics, one unit increase in RN HPPD was significantly associated with shorter lengths of stay by a factor of 2% (IRR=0.98, p<0.001); one percent increase in RN skill mix was associated with shorter lengths of stay by a factor of 3% (IRR=0.97, p<0.001); one unit increase in the Sep-1 score was associated with shorter lengths of stay by a factor of 2% (IRR=0.98, p<0.001).

The projected reduction in LOS and the associated costs, if all hospitals were staffed at different levels of RN HPPD and RN skill mix, are shown in Table 4. These findings suggest that if all hospitals were staffed at 9 RN HPPD and 80% RN skill mix or above, there could be a reduction of 63,580 inpatient days, yielding a total annual cost saving of $152,899,303. This projected trend continued, in which if all hospitals were staffed at 11 RN HPPD and 85% RN skill mix or above, there could be a reduction of 138,017 inpatient days, yielding a total cost saving of $331,907,882.

In this study, we found RN workload and skill mix were associated with patient LOS and hospital costs. Our results indicate this balance between RN staffing and resource use can be refined by increasing RN HPPD and changing the skill mix so higher levels of RN staff and increased levels of RN skill mix can result in shorter LOS and potentially significant savings on hospital costs. These results are consistent with previous findings that better RN staffing and skill mix were associated with improved outcomes for patients with sepsis (Cimiotti et al., 2022; Lasater et al., 2021). Our research broadens these findings through an assessment of the potential cost savings associated with reductions in LOS in septic patients.

Over the past 25 years, the relationship between RN staffing and patient outcomes has been a central focus of nursing research, with early studies demonstrating links to mortality, complications, and patient satisfaction (Aiken et al., 2002). More recently, attention has turned to understanding the economic implications of staffing decisions, aligning with the increasing emphasis on value-based care (Lasater et al., 2021). Our study extends this body of work by showing that better RN staffing and skill mix are associated not only with improved patient outcomes but also with shorter LOS and reduced hospital costs. This evidence underscores the dual clinical and financial benefits of investing in nursing resources.

The role of RNs in hospital operations and patient outcomes is critical but often challenged by staffing shortages, high turnover, and mounting financial pressures. These issues lead to increased workloads, compromised patient care, and ethical dilemmas as RNs strive to meet national quality metrics. Our findings highlight that strategic investments in RN staffing can yield cost savings and improve outcomes, but barriers such as limited budgets, competing priorities, and difficulties in quantifying returns often hinder progress. Addressing these challenges requires further research to validate the economic benefits of nursing and policy initiatives to incentivize workforce investment. RNs are especially vital in sepsis care, where increased RN assessments and interventions have been shown to improve outcomes and reduce costs (Jones et al., 2015). Simulated scenarios offer a promising approach to determining the optimal RN staffing levels needed for effective management of complex cases like sepsis. How hospitals address these challenges will significantly impact patient care quality, hospital performance, and workforce sustainability.

Nursing leaders have been actively engaged in discussions regarding the impact of RN value generation on both hospital operations and patient outcomes. This conversation stems from the common perception that RNs primarily contribute to one aspect of a hospital’s financial ledger: expenditure. However, numerous studies, including the one conducted here, suggest that investing in the nursing workforce can result in cost savings across hospital operations (Everhart et al., 2013; Griffiths et al., 2023; Lasater et al., 2021). While it is true that RNs do not directly contribute to revenue generation through billing processes, their pivotal role in patient care cannot be overstated. RNs are instrumental in orchestrating and delivering care, ensuring its effectiveness and efficiency.

To that end, our study aligns with nursing production economics principles, which emphasize that optimizing nursing inputs may enhance healthcare efficiency (Newbold, 2008). By showing that increased RN staffing and skill mix are associated with shorter LOS and reduced costs, we highlight how strategic nursing investments may improve both financial and patient care outcomes. While these investments entail higher labor costs, they may be offset by savings from reduced LOS and better outcomes, as supported by studies like Griffiths et al. (2023), which reinforce the business case for investing in nursing. However, hospitals often hesitate to adopt optimal staffing levels due to budget constraints, competing priorities, and challenges in quantifying financial returns (Everhart et al., 2013). A lack of awareness about the long-term gains from improved staffing further limits these investments. Despite these barriers, our findings contribute to the evidence supporting nursing as a strategic investment.

This study had a few limitations. First, our findings show important links between RN staffing, skill mix, LOS, and hospital costs, but the cross-sectional design limits our ability to establish causation. It is important to note that the relationships that we did observe may, in fact, be influenced by other unmeasured factors. Therefore, readers should view these results as part of a broader evidence base rather than conclusive proof. Future longitudinal studies should explore dynamic relationships between staffing, patient outcomes, and financial performance over time, integrating economic modeling to deepen our understanding of these interactions. Additionally, given today’s workforce crisis, innovative staffing strategies and their implications for nurse retention, well-being, and patient care quality merit further exploration. Second, our sample included only those acute care hospitals that provided completed data on RN staffing, skill mix, and Sep-1 scores, which could limit the generalizability of findings. However, our sample of hospitals was large and represented 2,107 hospitals (55%) nationwide. Third, the estimates of hospital sepsis-related costs were national Medicare averages, and the actual costs could vary by hospital and geographical region. However, the estimates were obtained from 659 million Medicare sepsis-related encounters representing 20% of the U.S. population and reflective of Medicare’s costs (Paoli et al., 2018).

The findings from this study provide further evidence that RN staffing is associated with the quality of patient care. In this case, we noted a substantial decrease in LOS among Medicare beneficiaries with sepsis; a decrease that was associated with better RN staffing and substantial cost savings to hospitals. These findings create a business case for nursing; suggesting that enhancing nursing resources is not merely an expense but a strategic investment that can improve patient outcomes and offer economic advantages to hospitals. The challenge at hand is the ongoing workforce crisis and how healthcare systems position themselves moving forward. It is those systems that provide RNs with a reasonable workload and a supportive environment that will attract and retain RNs and improve the overall quality of care.