Are Publicly Reported Quality Measures Aligned with Nursing Home Prices?

Jan P. Clement, Jaya Khushalani

Abstract


Public quality reports have become widespread in the US.  A largely unexplored area concerning how health care providers react is whether quality information may influence their prices.  Using the publicly available Centers for Medicare and Medicaid Services Nursing Home Compare five star quality ratings and the self-pay per diem price for a semi-private room, we evaluate whether publicly available quality ratings are related to prices in Virginia nursing homes.  Data for self-pay semi-private nursing home rooms posted on the Virginia Health Information web site for the 2011 fiscal year were merged with Nursing Home Compare quality data as well as market and organizational data.  Cross-sectional multiple regression models were estimated using the overall five star quality rating and separately for each of the three components of the overall rating.  The results show that the overall quality rating is not significantly related to the price.  One of the three components of the overall rating, quality measures, has a significantly higher price for higher than lower quality.  Thus, our results indicate that nursing homes in Virginia were not using higher NHC ratings to charge higher prices to their self-pay residents during the study period.  Frail elderly residents of these nursing homes, who face a large financial burden for care, paid similar prices for nursing homes with high and low quality of care ratings on Nursing Home Compare.    


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References


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