Nursing Home Quality and Financial Performance

Is There a Business Case for Quality

Bibliographic Data

ID13774942
AuthorsRobert Weech-Maldonado (0000-0002-5005-0909, University of Alabama at Birmingham, corresponding author), Rohit Pradhan (0009-0006-3762-7212, University of Arkansas for Medical Sciences, Little Rock, USA), Neeraj Dayama (0000-0002-4273-9415, University of Arkansas for Medical Sciences, Little Rock, USA), Justin Lord (0000-0002-4557-955X, Louisiana State University Shreveport, USA), Shivani Gupta (0000-0003-3690-8902, The University of Southern Mississippi, Hattiesburg, MS, USA)
Year2019
Volume56
Pages46958018825191-46958018825191
Publication date2019-01-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueINQUIRY The Journal of Health Care Organization Provision and Financing (JOURNAL)
Journal identifiersISSN: 0046-9580 • E-ISSN: 1945-7243
PublisherSAGE Publishing (PUBLISHER • US)
DOI10.1177/0046958018825191
PMID30739511
OpenAlexW2911948774
LanguageEN
Citations received10
References cited38

This study examines the relationship between nursing home quality and financial performance to assess whether there is a business case for quality. Secondary data sources included the Online Survey Certification and Reporting (OSCAR), Certification and Survey Provider Enhanced Reporting (CASPER), Medicare Cost Reports, Minimum Data Set (MDS 2.0), Area Resource File (ARF), and LTCFocus for all free-standing, nongovernment nursing homes for 2000 to 2014. Data were analyzed using panel data linear regression with facility and year fixed effects. The dependent variable, financial performance, consisted of the operating margin. The independent variables comprised nursing home quality measures that capture the three dimensions of Donabedian's structure-process-outcomes framework: structure Registered Nurse (RN) hours per resident day, Licensed Practical Nurse (LPN) hours per resident day, Certified Nursing Assistant (CNA) hours per resident day, RN skill mix), process (facility-acquired restraints, facility-acquired catheters, pressure ulcer prevention, and restorative ambulation), and outcomes (facility-acquired contractures, facility-acquired pressure ulcers, hospitalizations per resident, rehospitalizations, and health deficiencies). Control variables included size, average acuity index, market competition, per capita income, and Medicare Advantage penetration rate. This study found that the operating margin was lower in nursing homes that reported higher LPN hours per resident day and higher RN skill mix (structure); higher use of catheters, lower pressure ulcer prevention, and lower restorative ambulation (process); and more residents with contractures, pressure ulcers, hospitalizations and health deficiencies (outcomes). The results suggest that there is a business case for quality, whereas nursing homes that have better processes and outcomes of care perform better financially

Business · Quality (philosophy · Dementia and Cognitive Impairment Research · Finance · Geriatric Care and Nursing Homes · Medicine · Nursing · Patient Satisfaction in Healthcare

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