Local Government Nursing Homes: Incentives, Quality, and Sustainability
Presentation, American Society for Public Administration (ASPA) Annual Conference, Los Angeles, California (*expected*)
Medicaid supplemental payments are a vital but often opaque tool in financing long- term care, designed to stabilize providers and ensure access for low-income populations. Yet these payments also create powerful incentives that shape ownership and governance decisions. This paper examines the growing trend of nursing homes converting to local government ownership as a strategy to capture supplemental payments. Using national nursing home data linked to ownership status and quality indicators, I find evidence of a selection effect: facilities with poorer quality (measured by higher rates of on-site inspection deficiencies) are disproportionately those that transition into local government ownership.
