Incentivizing Better Quality of Care: The Role of Medicaid and Competition in the Nursing Home Industry

Martin Hackmann

American Economic Review, 2019, vol. 109, issue 5, 1684-1716

Abstract: This paper develops a model of the nursing home industry to investigate the quality effects of policies that either raise regulated reimbursement rates or increase local competition. Using data from Pennsylvania, I estimate the parameters of the model. The findings indicate that nursing homes increase the quality of care, measured by the number of skilled nurses per resident, by 8.7 percent following a universal 10 percent increase in Medicaid reimbursement rates. In contrast, I find that pro-competitive policies lead to only small increases in skilled nurse staffing ratios, suggesting that Medicaid increases are more cost effective in raising the quality of care.

JEL-codes: I11 I13 I18 I38 J14 L13 (search for similar items in EconPapers)
Date: 2019
Note: DOI: 10.1257/aer.20151057
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Working Paper: Incentivizing Better Quality of Care: The Role of Medicaid and Competition in the Nursing Home Industry (2017)
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