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Does the public sector outperform the nonprofit and for-profit sectors? Evidence from a national panel study on nursing home quality and access

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  • Anna A. Amirkhanyan

    (American University)

  • Hyun Joon Kim

    (Texas Tech University)

  • Kristina T. Lambright

    (Binghamton University)

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    Abstract

    Are public and private organizations fundamentally different? This question has been among the most enduring inquiries in public administration. Our study explores the impact of organizational ownership on two complementary aspects of performance: service quality and access to services for impoverished clients. Derived from public management research on performance determinants and nursing home care literature, our hypotheses stipulate that public, nonprofit, and forprofit nursing homes use different approaches to balance the strategic tradeoff between two aspects of performance. Panel data on 14,423 facilities were analyzed to compare measures of quality and access across three sectors using different estimation methods. Findings indicate that ownership status is associated with critical differences in both quality and access. Public and nonprofit organizations are similar in terms of quality, and both perform significantly better than their forprofit counterparts. When compared to nonprofit and, in some cases, for-profit facilities, public nursing homes have a significantly higher share of Medicaid recipients. The paper proposes strategies to address the identified long-term care divide. © 2008 by the Association for Public Policy Analysis and Management.

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    File URL: http://hdl.handle.net/10.1002/pam.20327
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    Bibliographic Info

    Article provided by John Wiley & Sons, Ltd. in its journal Journal of Policy Analysis and Management.

    Volume (Year): 27 (2008)
    Issue (Month): 2 ()
    Pages: 326-353

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    Handle: RePEc:wly:jpamgt:v:27:y:2008:i:2:p:326-353

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    Web page: http://www3.interscience.wiley.com/journal/34787/home

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    1. Vining, Aidan R & Boardman, Anthony E, 1992. " Ownership versus Competition: Efficiency in Public Enterprise," Public Choice, Springer, vol. 73(2), pages 205-39, March.
    2. Oliver Hart & Andrei Shleifer & Robert W. Vishny, 1996. "The Proper Scope of Government: Theory and an Application to Prisons," NBER Working Papers 5744, National Bureau of Economic Research, Inc.
    3. Carolyn J. Heinrich, 2000. "Organizational form and performance: An empirical investigation of nonprofit and for-profit job-training service providers," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 19(2), pages 233-261.
    4. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
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    Cited by:
    1. Datta, Anusua & Vandegrift, Donald, 2011. "Effects of welfare reform and the state children’s health insurance program on medicaid and total health expenditures," MPRA Paper 36486, University Library of Munich, Germany.
    2. Spagnolo, Giancarlo & Bergman, Mats A. & Lundberg, Sofia, 2012. "Privatization and Quality: Evidence from Elderly Care in Sweden," SITE Working Paper Series 19, Stockholm Institute of Transition Economics, Stockholm School of Economics.
    3. Bergman, Mats & Johansson, Per & Lundberg, Sofia & Spagnolo, Giancarlo, 2014. "Privatization and Quality: Evidence from Elderly Care in Sweden," CEPR Discussion Papers 9939, C.E.P.R. Discussion Papers.

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