Despite the increasing costs and continual debate over the financing of nursing home care, very little is known about how individuals pay for their nursing home stays. Although aggregate data quantify the level of Federal, State, and out-of-pocket, expenditure, there is little information available which documents the patchwork and sequence of sources of payment used by individuals over the course of their nursing home use. This study seeks to describe the primary payment sources used by elderly nursing home residents and the changes in these sources of payment over the course of their illness. Analyses will be conducted using longitudinal administrative and patient assessment data from 43 facilities in the National Health Corporation located in four states (Kentucky, Missouri, Tennessee, South Carolina); these data follow residents from the time of their initial admission for up to five years. Multivariate statistical models will examine the time until residents convert to Medicaid as well as the characteristics of residents who convert. These models will be interpreted in light of Medicaid policies in the four states from which the nursing home residents for up to five years in a nursing home will be modeled using event history analysis.