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Explaining differences in remuneration rates of nursing homes in Germany

Roman Mennicken (), Boris Augurzky (), Heinz Rothgang and Juergen Wasem

The European Journal of Health Economics, 2014, vol. 15, issue 4, 410 pages

Abstract: Remuneration rates of German nursing homes are prospectively negotiated between long-term care insurance (LTCI) and social assistance on the one side and nursing homes on the other. They differ considerably across regions while there is no evidence for substantial differences in care provision. This article explains the differences in the remuneration rates by observable characteristics of the nursing home, its residents and its region with a special focus on the largest federal state of North Rhine Westphalia, in which the most expensive nursing homes are located. We use data from the German Federal Statistical Office for 2005 on all nursing homes that offer full-time residential care for the elderly. We find that differences in remuneration rates can partly be explained by exogenous factors. Controls for residents, nursing homes and district characteristics explain roughly 30 % of the price difference; 40 % can be ascribed to a regionally different kind of negotiation between nursing homes and LTCI. Thirty percent of the raw price difference remains unexplained by observable characteristics. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Nursing homes; Determinants of remuneration rates; Regional price differences; I11; I18 (search for similar items in EconPapers)
Date: 2014
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Working Paper: Explaining Differences in Remuneration Rates of Nursing Homes in Germany (2010) Downloads
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DOI: 10.1007/s10198-013-0483-2

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The European Journal of Health Economics is currently edited by J.-M.G.v.d. Schulenburg

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