Nursing Homes with Persistent High and Low Quality

Abstract

This article examines the concentration of low- and high-quality care within particular nursing facilities over time. The authors explore three different explanations for persistent low and high quality over time including the level of public reimbursement, the presence of bed constraint policies such as certificate-of-need and construction moratoria, and the role of consumer information. Using 1991 through 1999 data from the On-Line Survey, Certification, and Reporting system, the authors show that both low- and high-quality nursing home care is concentrated in certain facilities over time. Their results further show that public reimbursement and asymmetric information are both important factors in explaining why low quality persists over time in certain facilities.