Nursing Home Price and Quality Responses to Publicly Reported Quality Information

ObjectiveTo assess whether the release of Nursing Home Compare (NHC) data affected self‐pay per diem prices and quality of care.Data SourcesPrimary data sources are the Annual Survey of Wisconsin Nursing Homes for 2001–2003, Online Survey and Certification Reporting System, NHC, and Area Resource File.Study DesignWe estimated fixed effects models with robust standard errors of per diem self‐pay charge and quality before and after NHC.Principal FindingsAfter NHC, low‐quality nursing homes raised their prices by a small but significant amount and decreased their use of restraints but did not reduce pressure sores. Mid‐level and high‐quality nursing homes did not significantly increase self‐pay prices after NHC nor consistently change quality.ConclusionsOur findings suggest that the release of quality information affected nursing home behavior, especially pricing and quality decisions among low‐quality facilities. Policy makers should continue to monitor quality and prices for self‐pay residents and scrutinize low‐quality homes over time to see whether they are on a pathway to improve quality. In addition, policy makers should not expect public reporting to result in quick fixes to nursing home quality problems.