Table 3.
The Effect of Introducing Medicaid Wage Pass-through on Direct-Care Staffing Levels in Nursing Homes in All States (Excluding California and Michigan), 1996–2004
| CNA |
LPN |
RN |
|||||||
|---|---|---|---|---|---|---|---|---|---|
| 2nd Step‡ |
2nd Step‡ |
2nd Step‡ |
|||||||
| 1st Step† (1) OLS | (2) OLS | (3) FGLS | 1st Step† (1) OLS | (2) OLS | (3) FGLS | 1st Step† (1) OLS | (2) OLS | (3) FGLS | |
| Wage pass-through:§ | |||||||||
| Year of adoption | 0.0289 | 0.0121 | 0.0170 | 0.0028 | 0.0086 | 0.0122 | 0.0553*** | 0.0451 | 0.0469 |
| (0.0187) | (0.0150) | (0.0121) | (0.0211) | (0.0327) | (0.0291) | (0.0185) | (0.0292) | (0.0329) | |
| 1st year after adoption | 0.0421 | 0.0233 | 0.0214 | 0.0040 | 0.0066 | 0.0074 | 0.0596* | 0.0567* | 0.0482 |
| (0.0275) | (0.0173) | (0.0158) | (0.0180) | (0.0266) | (0.0235) | (0.0297) | (0.0324) | (0.0309) | |
| 2nd/subsequent years | 0.0193 | −0.0082 | 0.0023 | −0.0175 | 0.0555 | 0.0607 | −0.0324 | 0.0012 | −0.0024 |
| (0.0314) | (0.0214) | (0.0186) | (0.0312) | (0.0431) | (0.0404) | (0.0330) | (0.0399) | (0.0358) | |
| Policy repealed | 0.0033 | −0.0030 | 0.0040 | 0.0299 | 0.0264 | 0.0312 | −0.0975** | −0.0725 | −0.0670 |
| (0.0173) | (0.0197) | (0.0169) | (0.0327) | (0.0312) | (0.0272) | (0.0443) | (0.0433) | (0.0406) | |
| Medicaid payment rate | 0.0120 | 0.0008 | 0.0003 | 0.0086 | 0.0210** | 0.0206** | −0.0077 | 0.0010 | 0.0038 |
| (0.0079) | (0.0058) | (0.0044) | (0.0074) | (0.0091) | (0.0080) | (0.0088) | (0.0077) | (0.0076) | |
| Case-mix reimbursement | −0.0004 | −0.0082 | 0.0028 | −0.0421* | −0.0109 | −0.0076 | −0.0173 | 0.0145 | 0.0175 |
| (0.0168) | (0.0188) | (0.0166) | (0.0210) | (0.0203) | (0.0161) | (0.0343) | (0.0320) | (0.0293) | |
| Facility fixed effects | Yes | Yes | Yes | ||||||
| State fixed effects | Yes | Yes | Yes | ||||||
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Cluster (state) | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Number of observations | 66,263 | 414 | 414 | 66,551 | 414 | 414 | 66,560 | 414 | 414 |
In all first-step OLS models, the following time-varying covariates are controlled for—at the facility level: acuity index, employment of a nurse practitioner or physician assistant, having an Alzheimer's unit, and percent Medicaid; at the county level: average number of empty beds per nursing home, number of RNs per hospital bed, number of LPNs per hospital bed, number of nursing home beds per 1,000 population 65+, Medicare managed care penetration rate, and wage index.
In all second-step models, variables are ρ-differenced after being demeaned.
Reference category=Preadoption (including states that have never adopted pass-through throughout).
Statistical significance:
p<.10.
p<.05.
p<.01.
Numbers in parentheses are robust standard errors.