This proposed study will explore the effect of nursing home spending patterns on quality of care, staff mix and staff turnover by using financial ratio analysis methods. Analysis of financial ratios is one of the most effective and widely used methods of evaluating management behavior and strategic orientation. Financial ratio analysis has been traditionally used by creditors, stockholders, and top-level management decision makers in order to predict future conditions of a firm and to make plans that will influence the future course of events, including quality improvements. Studies on nursing home quality have only examined the effects of broad organizational factors such as profit status, profit margin, and total resident care cost on a number of quality indicators. The applicant proposes an analytical approach that will identify and examine specific financial ratios that help produce higher levels of quality by disaggregating total spending into a number of cost centers and activities. This new approach will clarify the effect of a facility's allocation of spending among different cost categories on a variety of quality indicators. Data sources include the Texas Medicaid Cost Report Data, a multidimensional set of quality indicators from the Minimum Data Set (MDS) and Online Survey Certification Automated Reporting (OSCAR) data sets, and market variables from the Area Resource File (ARF). These data will be used to develop a set of structure, process and outcome quality measures, including staff mix and staff turnover. The analysis will focus on the effect of financial ratios, controlling for market factors, on quality. In addition to the individual financial ratios, the applicant will evaluate the utility of a financial ratio scale as a predictor of quality. Furthermore, this study will explore racial and socioeconomic disparities in nursing homes. In order to improve nursing home quality, regulatory and payment policy must establish an incentive structure for practices that result in changes in the way the majority of facilities currently perform. Results from this study could identify limits on administrative costs or minimum direct resident care spending levels that suggest a more effective reimbursement structure. Such spending guidelines and changes in payment policy, combined with incentives for better staff mix and retention, might be more effective policy tools affecting nursing home management decisions than the poorly enforced federal minimum quality standards. ? ? ?
| Kash, Bita A; Boyer, Gregory J (2008) Advertising expenditures in the nursing home sector: evaluating the need for and purpose of advertising. J Healthc Manag 53:242-55;discussion 255-6 |
