ABSTRACT
The nursing home industry must be viewed in the context of the total health care delivery system. This chapter looks at the totality of health care expenditures and then proceeds to an analysis of the nursing home industry and related financial issues. The provision of nursing home care was not a major objective of the 1965 Social Security Act amendments. The quality-of-care issue came to the forefront in the nursing home scandals of the early 1970s. There are numerous differences in the demographic, ethnic, cultural, and geographic characteristics of the population that affect care needs and the suitability of nursing home services provided. Medicaid is the fastest growing component of most state budgets, in large part because Medicaid bears the cost for a significant portion of every state's nursing home residents. Many of the more egregious cases of quality problems in the nursing home industry have been chronicled in the public spotlight.
