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Nursing Home Price and Quality Responses to Publicly Reported Quality Information

Keywords: Quality; nursing homes; prices.

Objective: To assess whether the release of Nursing Home Compare (NHC) data affected self-pay per diem prices and quality of care.

Data Sources: Primary data sources are the Annual Survey of Wisconsin Nursing Homes for 20012003, Online Survey and Certification Reporting System, NHC, and Area Resource File.

Study Design: We estimated fixed effects models with robust standard errors of per diem self-pay charge and quality before and after NHC.

Principal Findings: After NHC, low-quality nursing homes raised their prices by a small but significant amount and decreased their use of restraints but did not reduce pressure sores. Mid-level and high-quality nursing homes did not significantly increase self-pay prices after NHC nor consistently change quality.

Conclusions: Our findings suggest that the release of quality information affected nursing home behavior, especially pricing and quality decisions among low-quality facilities. Policy makers should continue to monitor quality and prices for self-pay residents and scrutinize low-quality homes over time to see whether they are on a pathway to improve quality. In addition, policy makers should not expect public reporting to result in quick fixes to nursing home quality problems.

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