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Ownership conversion and closure in the nursing home industry
Author(s) -
Bowblis John R.
Publication year - 2011
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.1618
Subject(s) - closure (psychology) , reimbursement , prospective payment system , payment , business , nursing homes , profit (economics) , nursing , finance , actuarial science , medicine , economics , health care , economic growth , microeconomics , market economy
Ownership conversions and closures in the nursing home literature have largely been treated as separate issues. This paper studies the predictors of nursing home ownership conversions and closure in a common framework after the implementation of the Prospective Payment System in Medicare skilled nursing facilities. The switch in reimbursement regimes impacted facilities with greater exposure to Medicare and lower efficiency. Facilities that faced greater financial difficulty were more likely to be involved in an ownership conversion or closure, but after controlling for other factors the effect of exposure to Medicare is small. Further, factors that predict conversion were found to vary between not‐for‐profit and for‐profit facilities, while factors that predict closure were the same for each ownership type. Copyright © 2010 John Wiley & Sons, Ltd.