Poster #112 - The Effect of Nursing Home Closures: Staff Replacement, Resident Relocation, and Quality of Care

• In Event: Saturday Poster Luncheon

Abstract

This study investigates the impact of nursing home closures on the quality of care in neighboring facilities, with a focus on the disparities between urban and rural counties in the United States. Nursing home closures have become increasingly common, driven by factors such as reduced Medicaid reimbursements, rising operational costs, and staffing shortages, which were further exacerbated by the COVID-19 pandemic. While closures directly affect relocated residents, they also create spillover effects on nearby facilities, straining local long-term care (LTC) resources. This research addresses a critical gap in empirical studies by examining these spillover effects, particularly in rural areas where limited healthcare options intensify the effects of closures.

Using a Callaway and Sant’Anna Difference-in-Differences (C&S DID) approach, this study analyzes county-level data from 2009 to 2019, comparing counties with nursing home closures to those without. The independent variable is a binary indicator reflecting whether a county experienced a nursing home closure in a given year. Key outcome variables include occupancy rates, staffing levels, and five-star quality ratings (overall, staffing, health inspections, and quality measures) of remaining facilities. Data are drawn from the Provider of Services (POS) file, the Nursing Home Compare dataset, and the LTCFocus dataset, providing insights into facility-level characteristics, staffing, and quality, as well as demographic details on residents.

The results reveal significant occupancy rate increases following closures, particularly in rural areas, where fewer alternative care options lead to heightened demand for nearby nursing homes. This increased demand exacerbates staffing challenges, with rural counties experiencing substantial declines in both licensed practical nurse (LPN) and registered nurse (RN) hours per resident day (HPRD). In urban areas, the effect is concentrated among RNs, indicating that rural nursing homes face greater challenges in retaining higher-skilled staff. These staffing declines, particularly in rural settings, are associated with reductions in staffing quality ratings and health inspection ratings. By contrast, urban counties tend to show improvement in quality measures ratings, likely due to competitive pressures that drive facilities to improve efficiency and care quality.

These findings highlight the disparate effects of nursing home closures on the quality of care, with rural facilities at greater risk of a decline in care standards due to limited resources and recruitment challenges. The results underscore the need for targeted policy interventions to support rural nursing homes, ensuring equitable access to high-quality LTC services. Policymakers could consider increasing Medicaid reimbursement rates and introducing workforce incentives to attract and retain skilled staff in rural areas. Furthermore, the study suggests that market dynamics play a role in shaping these outcomes, as competitive pressures in urban areas promote improvements in care, whereas concentrated rural markets experience reduced accountability and performance.

In conclusion, this study provides new insights into the impact of nursing home closures on nearby facilities, emphasizing the urban-rural disparities in long-term care access and quality. By identifying these differences, the research informs strategies to mitigate healthcare disparities and improve LTC infrastructure, particularly in underserved rural communities.

Author

• Hyeonwoo Do, University at Albany
  Presenting Author