Ownership form and consumer welfare: evidence from the nursing home industry.
This paper compares the likely consumer benefits of higher quality with the potentially greater production costs that result from increased not-for-profit activity in a nursing home services market area. The comparison of consumer benefits and costs is made possible by observing empirically how an increased market penetration of not-for-profit facilities affects the use of private-pay nursing home care. Increased (decreased) use of nursing home care suggests that the consumer benefits associated with additional not-for-profit nursing homes are greater (less) than consumer costs. The empirical results indicate that, from a consumer's perspective, too few not-for-profit nursing homes may exist in the typical market area of the United States. The policy implication is that more quality of care per dollar might be obtained by attracting a greater percentage of not-for-profit nursing homes into many market areas.
Santerre
Rexford E
RE
Center for Healthcare and Insurance Studies, Department of Finance, School of Business, University of Connecticut, 2100 Hillside Road, Unit 1041, Storrs, CT 06269-1041, USA. rsanterre@business.uconn.edu
Vernon
John A
JA
D000368:Aged; D003258:Consumer Behavior; D006291:Health Policy; D006707:Homes for the Aged / Q000191:economics / Q000458:organization & administration* / Q000600:supply & distribution; D006801:Humans; D008484:Medicaid / Q000458:organization & administration; D006278:Medicare / Q000458:organization & administration; D009735:Nursing Homes / Q000191:economics / Q000458:organization & administration* / Q000600:supply & distribution; D009939:Organizations, Nonprofit / Q000458:organization & administration*; D011787:Quality of Health Care / Q000458:organization & administration*; D012044:Regression Analysis; D014481:United States