Competitive spillovers across non-profit and for-profit nursing homes.

Full Abstract

The importance of non-profit institutions in the health care sector has generated a vast empirical literature examining quality differences between non-profit and for-profit nursing homes. Recent theoretical work has emphasized that much of this empirical literature is flawed in that previous studies rely solely on dummy variables to capture the effects of ownership rather than accounting for the share of non-profit nursing homes in the market. This analysis considers whether competitive spillovers from non-profits lead to higher quality in for-profit nursing homes. Using instrumental variables to account for the potential endogeneity of non-profit market share, this study finds that an increase in non-profit market share improves for-profit and overall nursing home quality. These findings are consistent with the hypothesis that non-profits serve as a quality signal for uninformed nursing home consumers.

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Author information

Author/s: Grabowski, David C (DC); Hirth, Richard A (RA);

Affiliation: Department of Health Care Organization and Policy, University of Alabama at Birmingham, 330 RPHB 1655 University Boulevard, Birmingham, AL 35294, USA. grabowsk(-atsign-)uab.edu

Journal and publication information

Publication Type: Journal Article

Journal: Journal of health economics (J Health Econ), published in Netherlands. (Language: eng)

Reference: 2003-Jan; vol 22 (issue 1) : pp 1-22

Dates: Created 2003/02/04; Completed 2003/02/25; Revised 2004/11/17;

PMID: 12564715, status: MEDLINE (last retrieval date: 12/26/2008)

Sourced from the National Library of Medicine. Abstract text and other information may be subject to copyright.

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MeSH headings (categories)

This article was linked to the MESH Headings shown below.

Aged
Decision Making
Economic Competition
Health Facilities, Proprietary - economics; standards; utilization
Health Services Needs and Demand
Humans
Information Dissemination

Information Dissemination
Models, Statistical
Nursing Homes - economics; organization & administration; standards
Organizations, Nonprofit - economics; standards; utilization
Ownership
Quality of Health Care
United States

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