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Do report cards predict future quality? The case of skilled nursing facilities

Author

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  • Cornell, Portia Y.
  • Grabowski, David C.
  • Norton, Edward C.
  • Rahman, Momotazur

Abstract

Report cards on provider performance are intended to improve consumer decision-making and address information gaps in the market for quality. However, inadequate risk adjustment of report-card measures often biases comparisons across providers. We test whether going to a skilled nursing facility (SNF) with a higher star rating leads to better quality outcomes for a patient. We exploit variation over time in the distance from a patient’s residential ZIP code to SNFs with different ratings to estimate the causal effect of admission to a higher-rated SNF on health care outcomes, including mortality. We found that patients who go to higher-rated SNFs achieved better outcomes, supporting the validity of the SNF report card ratings.

Suggested Citation

  • Cornell, Portia Y. & Grabowski, David C. & Norton, Edward C. & Rahman, Momotazur, 2019. "Do report cards predict future quality? The case of skilled nursing facilities," Journal of Health Economics, Elsevier, vol. 66(C), pages 208-221.
  • Handle: RePEc:eee:jhecon:v:66:y:2019:i:c:p:208-221
    DOI: 10.1016/j.jhealeco.2019.05.008
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    Keywords

    Skilled nursing facility; Star ratings; Instrumental variables; Nursing home quality of care; Post-acute care;

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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