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Alsaif, Saleh Saud
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Middle Tennessee State University
Despite the many benefits of federal and state regulation to the society, regulations may be counterproductive to economic development objectives across the United States. The purpose of this dissertation is to inform policymakers of the impact of CON law on market conditions and share the results of policies imposed on a sector of health care, specifically the nursing home industry. The certificate-of-need requirements in the nursing home industry represent a challenging set of regulations for potential firms as well as the already existing nursing homes in a given market. Many scholars believed that the CON Regulation limits competition and prevents the growth of the nursing home industry through a decrease in the number of beds. In studying the effects of this regulation, I examined the outcome of the Certificate of need (CON) regulations on the nursing home industry from different perspectives.
The first chapter examines the factors that influence the number of nursing homes, occupancy rates, and the occurrence of over-bedding. The study shows that the Certificate-of-Need laws imposed some restriction on the number of nursing homes. The data was extracted from the Centers for Medicare and Medicaid Services including types of nursing homes in CON states and non-CON states. The sample covered 2334 counties or 75 percent of all counties in the contiguous states for 2012, 2013, and 2014. Precisely, the findings show that the Certificate-of-Need regulation is associated with a lower number of nursing homes, while no impact is shown for the case of occupancy rates. However, CON laws were slightly reducing the over-bedding occurrence.
The second chapter shows the impact of CON laws on quality of care in the nursing homes industry. The quality dilemma resulted in a massive empirical literature investigating the quality differences between the nursing homes by comparing ownership types. The existing work highlighted the empirical studies are inconsistent, where previous literature depends exclusively on dummy variables rather than quantifiable measures of quality to capture the effects of cost-control regulations. Using a variety of data sources and different model specifications that account for endogeneity. The study investigates the impact of implementing the certificate-of-need laws on the quality of service in for-profit nursing homes. The findings of this study suggest that nursing homes in the CON states tend to reduce their costs by hiring less skilled nurses and through scheduling fewer hours for LPNs and more hours for CNAs.
The third chapter focuses on the grey area of the effect of operational characteristics and service provider’s type on the participation of the nursing homes into Medicaid. To investigate how Medicaid Participation varies across all types of ownership and within all markets. The logistic regression model is used to find the determining factors of participation. In this analysis, many indicators were incorporated, and they were stemming from health factors, ownership types, and performance-based characteristics. The findings of this study suggest that for-profit nursing homes, specifically individually owned nursing homes, tend to have higher a probability of participation in Medicaid than any other type of ownership. From the operational perspective, a one-unit increase in nurse staffing hours was found to be associated with an increase in the probability of becoming a Medicaid participant by 2.3 percentage points.
Certificate-of-need, Market Conditions, Medicaid Participation, Occupancy Rates, Over-bedding, Quality of care