Nursing Home Closures, Changes in Ownership, and Competition

Abstract

This research examines the relationship of competition among nursing homes and the likelihood of their closure or change in ownership. The study uses nationally representative data from the 1992–1998 Online Survey, Certification, and Reporting system, and is supplemented with several other primary and secondary data sources. It is hypothesized that facilities located in more competitive environments will be more likely to close. Multinomial logistic regression analyses are employed to examine this hypothesis in a model containing organizational and aggregate resident characteristics, and market factors. The Herfindahl index is used as a measure of competition. The descriptive analysis shows that 621 nursing homes closed and 6,471 changed ownership from 1992 to 1998. The incidence rate of closures was .7% of facilities per year. The multivariate analysis shows that facilities located in more competitive environments were significantly more likely to close.

Results of a longitudinal analysis of national data to examine relationships between organizational and market characteristics and changes in antipsychotic prescribing in US nursing homes from 1996 through 2006

“…A continuous measure was included for the activities of daily living (ADL) score. The ADL score is a facility score (ranging from 0 to 1) based on 6 OSCAR questions (dif- ficulty with bathing, dressing, toileting, transferring, feeding, or walking) 25. Increasing scores indicate a great- er average ADL impairment within the facility.…”

A configurational view of executive selection behaviours: a taxonomy of USA acute care hospitals

“…In the nursing home industry, per capita income and reimbursement rates are related to both organizational closures and changes in ownership. 41 The amount of change in a hospital's environment has an effect on organizational strategies. Hospitals in environments that are stable adopt efficiency-oriented strategies while those in environments perceived to be unstable pursue market-focused strategies.…”

Multilevel Factors Related to Psychosocial Care Outcomes in Washington State Skilled Nursing Facilities

“…OSCAR does not specify the reason for ownership change, whether a facility was sold related to poor performance or was acquired due to excellent performance (Castle, 2005). However, prior research suggests that a turn-around scenario is the most frequent category of ownership change, whereby high-quality chains purchase low quality bargain-priced facilities and subsequently improve their performance (Banaszak-Holl, Berta, Bowman, Baum, & Mitchell, 2002 change often has a destabilizing effect on facilities' capacity for quality care provision; this is true even among high-quality chain/low-quality facility acquisitions, at least for the short term (Banaszak-Holl et al, 2002).…”