Payer Incentives and Physical Rehabilitation Therapy for Nonelderly Institutional Long-Term Care Residents: Evidence from Michigan and Ontario

Objective: To examine the effect of payment incentives on the provision of rehabilitation therapy to nonelderly nursing home residents. Design: Retrospective cross-sectional study. Setting: Nursing homes in Michigan or complex continuing care facilities in Ontario, Canada, in 1998 or 1999. Participants: Nonelderly nursing home residents (N = 5189) admitted to nursing homes. Interventions: Not applicable. Main Outcome Measures: The effect of payment on access to physical therapy (PT) and occupational therapy (OT) and total weekly time for each therapy type. Results: A Medicare policy change from cost-based to a patient-specific case-mix payment method was associated with greater likelihood of receiving OT but reduced weekly minutes of PT and OT provided to residents. Medicare cost-based and private insurance were associated with greater likelihood of receiving OT and PT and more therapy time for both types of therapy compared with private-pay residents. Global budget payment was associated with greater access to PT but fewer weekly minutes of OT and PT. Conclusions: Little information exists to describe the characteristics and treatment of nonelderly nursing home residents. This study found that many of these residents received rehabilitation and that residents whose care was paid for by more generous payers, such as Medicare, received more therapy than those paid for by less generous payers.