The Economic Impact of the Expansion of Nurse Practitioner Scope of Practice for Medicaid

The demand for primary care services may surpass the supply of primary care providers, exacerbating challenges with access, quality, and cost in the U.S. healthcare system. Expanding the supply of, and access to, nurse practitioner (NP) care has been proposed as one method to alleviate these challenges.

To estimate the impact of expanded NP scope of practice (SOP) regulations on the costs of total outpatient visits, prescription drugs, and total care days received by Medicaid beneficiaries nationwide from 1999–2011.

We used a longitudinal data policy analysis framework and built a fixed-effect model, a generalized form of a difference-in-differences model, to identify the effect of changes in NP SOP regulations on the outcome variables. The models included controls for state income and unemployment rates.

Compared to states with reduced SOP, states with full SOP had 17% lower outpatient costs (i.e., $160.45 per beneficiary per year) and 10.9% lower prescription drug costs (i.e., $145.44 per beneficiary per year). States with restricted SOP had 11.6% higher outpatient costs (i.e., $107.31 per beneficiary per year) and 5.1% higher prescription drug costs (i.e., $67.89 per beneficiary per year). Annual total care days were 8% (i.e., 819,905.9 days) higher in states with full SOP compared to states with reduced SOP (p = .05).

States that expand NP SOP may provide greater intensity of care (measured using total care days) to Medicaid patients without increasing total costs of care.