Working Paper: NBER ID: w24133
Authors: Martin B. Hackmann
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 8.8% following a universal 10% 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.
Keywords: Medicaid; Nursing Homes; Quality of Care; Competition
JEL Codes: I11; I18; L13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| competition (L13) | number of skilled nurses per resident (I11) |
| Medicaid reimbursement rates (I18) | welfare gain (D69) |
| Medicaid reimbursement rates (I18) | responsiveness of nursing homes (I11) |
| Medicaid reimbursement rates (I18) | quality of care (I11) |
| Medicaid reimbursement rates (I18) | number of skilled nurses per resident (I11) |