Do corporate chains affect quality of care in nursing homes? The role of corporate standardization.

Background: Chain-owned nursing homes have become the predominant type of provider in the United States, but little is known about their management structures. Prior research has found that chain ownership has significant effects on health outcomes, but why that is the case is not well understood.

Purpose: This study examines the effects of corporate-mandated standardization and corporate-sponsored training in administrative and clinical processes on the total number of deficiencies reported for a facility and on the percentage of residents with pressure ulcers for chain-owned facilities in Michigan and North Carolina.

Methodology: Data on the corporate practices of standardization and training were collected in a mail survey of facility administrators in Michigan in 2001 and North Carolina in 2002. We received responses from 117 of 239 chain-owned facilities in Michigan and 86 of 270 in North Carolina. Survey responses were merged with facility characteristics taken from the On-line Survey, Certification, and Report System. Seemingly unrelated regression was used to estimate the effects of standardization on the count of health deficiencies and percentage of residents with pressure ulcers simultaneously.

Findings: Health deficiencies, but not pressure ulcers, were lower in facilities of chains with greater overall corporate standardization. More detailed analysis revealed that standardization of facilities' physical plant lowered both deficiencies and pressure ulcers and standardization of clinical activities lowered pressure ulcers (but not deficiencies). In contrast, standardization of administrative practices increased pressure ulcers (but not deficiencies).

Practice Implications: Corporate standardization of resident-centered activities such as clinical guidelines and common facility layouts may contribute to superior resident care, whereas primary reliance on administrative standardization may interfere with residents' needs. Chains need to balance administrative efficiency with the local needs of individual chain-owned facilities and their residents.