The impact of asymmetric information and ownership on nursing home access.
A consistent pattern in the nursing home industry is that non-profit institutions serve a lower proportion of Medicaid patients than do for-profit facilities. This is contrary to the expectation that non-profit, altruistically motivated firms should serve a larger proportion of the less profitable Medicaid patients than proprietary firms. The literature confirms this pattern empirically, but provides no theoretical basis for it, which is the contribution of this paper. Specifically, we show theoretically that information disparities between providers and consumers regarding quality fosters an environment in which the percentage of uninformed consumers is a key factor in determining public-private patient mix.
Christensen
Eric W
EW
CNA Corporation, Alexandria, VA, USA.
Arnould
Richard J
RJ
D003258:Consumer Behavior / Q000191:economics; D004465:Economic Competition / Q000458:organization & administration*; D006269:Health Facilities, Proprietary / Q000191:economics / Q000706:statistics & numerical data*; D007722:Health Knowledge, Attitudes, Practice; D006297:Health Services Accessibility / Q000191:economics*; D006302:Health Services Research; D006801:Humans; D033181:Information Dissemination; D019458:Insurance Coverage; D008484:Medicaid / Q000706:statistics & numerical data*; D017059:Models, Econometric; D009735:Nursing Homes / Q000145:classification / Q000458:organization & administration*; D009939:Organizations, Nonprofit / Q000191:economics / Q000706:statistics & numerical data*; D010067:Ownership / Q000145:classification* / Q000191:economics; D011787:Quality of Health Care; D014481:United States