The 1990s brought shifts in the organization and financing of healthcare services and changes to the nursing workforce as well. These changes were pronounced in home healthcare, where growth in service use between 1988 and 1996 was followed by sharp contractions in home healthcare users and visits after changes in Medicare reimbursement policy in 1997. This article examines how the nursing workforce has responded to these changes, explores the challenges posed by the nursing shortage, highlights the gap in knowledge of the staffing-outcomes relationship and its implications for quality, and offers recommendations on ways to improve care.