Nursing Homes in Equilibrium: Implications for Long-term Care Policies

82 Pages Posted: 15 Jul 2021

See all articles by Tatyana Koreshkova

Tatyana Koreshkova

Concordia University, Quebec

Minjoon Lee

Carleton University

Date Written: September 2020

Abstract

We build an equilibrium model of the market for nursing home care with decision-makers on both sides of the market. The nursing home demand arises as a result of stochastic dynamic optimizations by households heterogeneous in age, health, wealth; and the cost of home-and-community-based care. On the supply side, locally competitive nursing homes decide prices and care intensity. The government pays for the long-term care of the poorest. We estimate the model parameters using Health and Retirement Survey and simulate the model to quantitatively evaluate the effects of long-term care policies on prices, intensities, care allocation, and welfare.

Keywords: Long-term Care, Nursing Home, Medicaid

Suggested Citation

Koreshkova, Tatyana and Lee, Minjoon, Nursing Homes in Equilibrium: Implications for Long-term Care Policies (September 2020). Available at SSRN: https://ssrn.com/abstract=3885803 or http://dx.doi.org/10.2139/ssrn.3885803

Tatyana Koreshkova

Concordia University, Quebec ( email )

1455 de Maisonneuve Blvd. W.
Montreal, Quebec H3G 1MB
Canada

Minjoon Lee (Contact Author)

Carleton University ( email )

1125 colonel By Drive
Ottawa, Ontario K1S 5B6
Canada

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