Do financial incentives influence the hospitalization rate of nursing home residents? Evidence from Germany

Efficient health‐care provision for nursing home residents is a concern in many OECD (Organization for Economic Cooperation and Development) countries. This paper analyzes whether nursing homes respond to financial incentives when deciding whether to hospitalize their residents. In Germany, reimbursements for nursing homes are reduced after a defined number of days when a resident stays in a hospital instead of a nursing home. As a result of a...