New information compiled by the Iowa Hospital Association shows a 1% increase in the Medicaid provider rate last year, coupled with matching federal funds, netted the state’s 117 hospitals around $2.3 million in new Medicaid revenue.

State lawmakers approved the 1% Medicaid payment increase to help pay for salary increases for nurses. I-H-A spokesperson Scott McIntyre the hospitals are keeping their word to boost nurse salaries by 30-million dollars. "We really don’t have a choice but to keep up with nurses salaries," McIntyre said. "There’s a nationwide shortage of nurses, it’s extremely competitive and you fall behind at your own demise. So, (boosting nurses salaries) is something our hospitals are simply committed to."

Iowa registered nurse salaries have traditionally been among the lowest in the nation, mirroring the fact that Iowa’s Medicare and Medicaid payments are also among the nation’s lowest. McIntyre says Medicare and Medicaid, combined, make up nearly 60% of Iowa hospital revenue. The continued dip in dollars from government-supported programs comes at a time when Iowa hospitals are offering more free services.

Iowa hospitals are on track to provide nearly $400 million in "charity care" this year, up 22% from 2008. McIntyre says a large group of registered nurses in Iowa will be expected to retire in the next 10 to 15 years – so hospitals are working hard to attract young people to the profession.

He says the faculty members, training those new nurses, are also getting older and preparing for retirement. "There’s just not enough capacity for the number of students who want to be nurses…that’s part of the problem now," McIntyre said. Many Iowa hospitals – in addition to the salary increases – are offering signing bonuses, flexible work schedules and subsidized continuing education as a means for attracting new nurses.