Changes in clinical and hotel expenditures following publication of the nursing home compare report card.
BACKGROUND
Nursing Home Compare first published clinical quality measures at the end of 2002. It is a quality report card that for the first time offers consumers easily accessible information about the clinical quality of nursing homes. It led to changes in consumers' demand, increasing the relative importance of clinical versus hotel aspects of quality in their search and choice of a nursing home.


OBJECTIVE
To examine the hypothesis that nursing homes responding to these changes in demand shifted the balance of resources from hotel to clinical activities.


METHODS
The study included 10,022 free-standing nursing homes nationwide during 2001 to 2006. RESEARCH DESIGN AND DATA: A retrospective multivariate statistical analysis of trends in the ratio of clinical to hotel expenditures, using Medicare cost reports, Minimum Data Set and Online Survey, Certification and Reporting data, controlling for changes in residents' acuity and facility fixed effects. Inference is based on robust standard errors.


RESULTS
The ratio of clinical to hotel expenditures averaged 1.78. It increased significantly (P < 0.001) by 5% following the publication of the report card. The increase was larger and more significant among nursing homes with worse reported quality, lower occupancy, those located in more competitive markets, for-profit ownership and owned by a chain.


CONCLUSIONS
The increase in the ratio of clinical to hotel expenditures following publication of the report card suggests that nursing homes responded as expected to the changes in the elasticity of demand with respect to clinical quality brought about by the public reporting of clinical quality measures. The response was stronger among nursing homes facing stronger incentives.
Mukamel
Dana B
DB
Department of Medicine, University of California Irvine, Health Policy Research Institute, Irvine, CA 92697-5800, USA. dmukamel@uci.edu
Spector
William D
WD
Zinn
Jacqueline
J
Weimer
David L
DL
Ahn
Richard
R
D019985:Benchmarking / Q000706:statistics & numerical data; D005249:Fees and Charges / Q000706:statistics & numerical data / Q000639:trends*; D017048:Health Care Costs / Q000706:statistics & numerical data / Q000639:trends*; D019538:Health Care Surveys; D005102:Health Expenditures / Q000706:statistics & numerical data / Q000639:trends*; D006801:Humans; D015999:Multivariate Analysis; D009735:Nursing Homes / Q000145:classification / Q000191:economics* / Q000706:statistics & numerical data*; D010067:Ownership; D017149:Private Sector / Q000706:statistics & numerical data; D011787:Quality of Health Care / Q000191:economics / Q000639:trends; D040841:Resource Allocation; D012189:Retrospective Studies; D014481:United States / Q000453:epidemiology