Quite frequently, data from administrative or clinical data sets are not considered suitable for research because of concerns about their validity and reliability. The authors discuss the important role that such data sets may play in the future of health care. To provide an indication that all administrative and clinical data bases do not provide inferior data, the authors compare the internal consistency and predictive validity of information from three statewide administrative/clinical databases, focusing on nursing home residents with comparable data from a research database. These databases contain information gathered using the Minimum Data Set (MDS) for Nursing Home Resident Assessment and Care Screening. The two dimensions of status considered in this illustration are cognition and physical function. The results of this comparison indicate that the assessment data in three statewide clinical/administrative databases are as reliable and valid as the data found in the research database. Finally, the authors discuss the precepts one might follow in developing clinical/administrative databases that provide good data. These precepts also can be used as guidelines in the evaluation of the probable usefulness of such databases for assessing outcomes among cognitively impaired nursing home residents.

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