Incentivizing Better Quality of Care: The Role of Medicaid and Competition in the Nursing Home Industry
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.
Published Versions
Martin B. Hackmann, 2019. "Incentivizing Better Quality of Care: The Role of Medicaid and Competition in the Nursing Home Industry," American Economic Review, vol 109(5), pages 1684-1716. citation courtesy of 
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