Nursing home administrators hit a record high national median salary this year, and so did directors of nursing. But each group saw a slowdown in momentum that built last year.

Numerous other nursing and therapy titles also were the subjects of lower pay hikes this year.
Administrators’ salaries have peaked at $80,000 per year, up 4.6% from a year ago. Salaries of DONs, meanwhile, reached $68,959, up 3.05% over a year ago. Registered nurses, licensed practical nurses and certified nursing aides all saw median pay raises of 2.7% or less.
The figures are reported in the 29th annual Nursing Home Salary and Benefits Report published by the Hospital & Healthcare Compensation Service. More than 2,500 nursing homes took part in the respected survey, which is produced in cooperation with the nation’s two major nursing home associations.
DONs also had their wings clipped, down one-fourth to 12.1%, when it came to bonus pay rates, while administrators’ rates basically held steady at 15.6%.
Compensation experts pointed to rising recognition of an administrator’s value to a nursing home’s operations, while theories on the nursing pay slowdown varied.
The median for assistant administrators, meanwhile, plunged 8.6%, to $53,591 — a statistical quirk likely caused by changes in the voluntary return sample. Assistant DONs experienced a 4.4% median hike, to $57,232, also less than last year’s.
The median is the point where half of all respondents are above and half below. More than 2,500 facilities submitted data for the recently released 2006-2007 Nursing Home Salary and Benefits Report, which is published annually by Hospital & Healthcare Compensation Service. One-third were nonprofit facilities and two-thirds were for-profit.

Bonus bust
The national median bonus for administrators who received a bonus rose ever so slightly, to 15.6% of salary, while DONs saw their bonus rate fall to 12.1%, down from 16.1% a year earlier.
The mixed signals were hard to read but apparently indicative of the kind of year it was for nurse compensation, experts said.
While nursing and therapist shortages continue to be a hot topic in professional circles, there are some signs employers are not as willing to pay bigger bucks to keep those professionals around, analysts said.
Salaried nursing supervisors saw their compensation levels stagnate (a 0.15% rise for RN supervisors) or actually recede (-1.02% for LPN supervisors). Meanwhile, hourly pay rates for staff nurses rose only modestly.
Median salary rises were: 2.34% for RNs, 2.66% for LPNs and 2.46% for CNAs. All rates are less than half of those a year earlier.
“Nurses didn’t increase as much as in previous years,” noted Rosanne Cioffe, director of reports for Oakland, NJ-based HHCS. “The same thing was true for physical therapists and occupational therapists.”
Speech therapists registered a 0.52% pay rate backslide (to $30.84 per hour) after an 8.8% rise the year before. Physical therapists (3.55% rise) and occupational therapists (1.89% rise) also saw their rates of increase drop by more than half.
“The RNs have been fairly consistent the past few years, with the amount of increase each year fairly consistent, about 5%, give or take a little,” observed Paul Dorf, managing director of Compensation Resources, Upper Saddle River, NJ. “But this year, the size of the increase dropped in half. That would tell me they’re starting to satisfy their needs or are using their personnel a little better so they don’t feel they need to pay as much.”
Dorf said a combination of circumstances have put pressure on salary levels, so generalizations have to be made carefully. But the fact that the use of agency nurses has “been markedly going down” is a sure signal from employers, he said.
“They’re clearly making a concerted effort not to spend the money,” Dorf said.
He also noted that therapy vacancies, by percentage, dropped noticeably over the last year. This is probably due, in part, to a wider array of providers offering services, he thinks.

Star players
Administrators seem to be in a stronger position than ever, Dorf said. With median salary rises of 3.9%, 5.1% and 4.5% in recent years, they also seem to be getting more respect, he added.
“There’s more agreement that these positions are fungible and if they want somebody good, they have to hang on to that person,” Dorf said. “We will continue to see management positions increase.”
He also said that, with more regulations and calls for transparency, “compensation arrangements and levels are probably coming closer together” for administrators at nonprofit, for-profit and government facilities.
“A properly trained administrator in a long-term care facility is the most important and strongest piece,” agreed Shawn Feinstein, manager of nationwide recruiting for CBIZ

Human Capital Services.
“Over the last three to five years, salaries have steadily increased, so there has been some momentum and awareness of the need for retention of administrators for these facilities. It has been an issue of needed improvement. But is it where it needs to be? No.”
Now a recruiter for all levels of healthcare professionals, Feinstein previously was a DON and administrator at a skilled nursing facility. But she “walked away from that sector of the healthcare industry because I became increasingly frustrated because the resources were not there,” she said.
Not enough has been passed along to on-site workers the past few years, especially with revenues up and profits having increased for many providers, she said.
“There are not enough qualified people who want to remain in long-term care. As an administrator, in addition to being challenged for compensation for yourself, there is frustration about the ability to compensate workers. They’re frustrated, like a rat on a wheel,” she said.
She accused owners of being “reactive instead of proactive” when it comes to compensation.
“When there’s a crisis situation, they’ll react to it. But as soon as they stabilize, they pull the reins back in,” she explained. “It’s sort of a push-and-pull situation.”

More than a paycheck
Salary data must be realized for what it is: just one of many tools to be considered. It’s often interesting data but sometimes missing nuance, cautioned Phillip B. Wilson, vice president-general counsel of LRI Management Services Inc., Broken Arrow, OK.
Salaries, he noted, may vary widely because of many factors, such as facility location, survey history, and workforce education and compatibility.
“It’s not that important to be the best-paying place in town. Have a great work environment,” Wilson advises. “It’s an important way to set yourself apart from competitors. The return on investment, in terms of care, for raising pay to be 5% higher than your closest competitor isn’t there, as opposed to creating a great place to work.
“We have some union facilities where employees are paid way above market and care outcomes are among the worst in the company,” he said. “Pay alone won’t do it.”
He says turnover patterns prove his point.
“Every RN, LPN and CNA knows somebody who has left for more money and come back,” he said. “That’s proof that investing to form a good environment is at least as valuable as the money.”
Turnover rates among nurses remained high, according to the survey. The national facility rate for CNAs was 42.8%, for RNs 34.6% and LPNs 32.2%.
The worst regions for RN turnover were No. 7, the West South Central (45.9%) and No. 9, the Pacific (45.6%). Region 2, the Middle Atlantic (28%), had the lowest average RN turnover.
Average CNA turnover was the highest in region No. 7 at 70%, while the lowest was region No. 2, the Middle Atlantic (32%).
LPN turnover ranged from a high of 47% in region No. 7 to a low of 27% in region No. 1, New England.

Nursing homes pay near top
RNs working at nursing homes were some of the better paid among the various settings. Only the national medians for RNs at hospitals ($27.72 per hour) and hospices ($24.62) were higher than the median for nursing home RNs ($24.07). Homecare ($23.92), CCRC ($23.77) and assisted living ($21.15) RNS were the lowest.
The LPN situation was a little bit different, with only CCRC ($18.36 per hour) RNs making more than their nursing home ($18.12) counterparts. Hospital ($17.55), hospice ($17.50), homecare ($17.35) and assisted living ($16.95) rates trailed.
Those with fingers closest to the business pulse seemed to fare consistently well in a comparison of salaries in this year’s and last year’s surveys.
Chief financial officers saw their national median salary rise 7.6%, to $91,500, the highest salary of 36 titles gauged by HHCS, and the only one that ranked higher than administrators’ $80,000.
Please refer to print version of September issue for more information and numerous charts based upon the results of the survey.