Governance Models and Care Quality in Long-Term Care Institutions: An Empirical Quantitative Study

Background: With approximately 1.3 million Americans residing in certified nursing homes—a population projected to double by 2050—identifying the organisational determinants of care quality is a critical public health imperative, particularly in the context of increasing marketisation of the long-term care (LTC) sector and evidence of widening quality disparities across ownership types. Despite decades of regulatory oversight, systemic deficiencies and wide variations in care quality persist, suggesting that governance architecture is a critical but insufficiently understood determinant. Objective: This study investigates how governance structures—ownership type, board composition, and executive management mechanisms—influence care quality in LTC institutions, and examines whether staffing ratios (nursing Hours Per Resident Day [HPRD]) mediate the governance–quality relationship as the primary resource mechanism through which governance decisions manifest in resident outcomes. Methods: A stratified random sample of 1,245 Medicare and Medicaid-certified nursing homes (Centers for Medicare and Medicaid Services [CMS] Provider Data Catalog, 2021–2025) was analysed. Governance was operationalised via ownership type (for-profit, non-profit, government), board independence (percentage of external directors), board size, CEO duality, and quality-linked managerial incentives. Care quality was modelled as a latent construct with three CMS-derived indicators: clinical outcome measures (Minimum Data Set [MDS] 3.0 adverse event composite), regulatory deficiency citations, and the Five-Star Rating. Multiple regression and Structural Equation Modelling (SEM) were employed to test six hypotheses grounded in an integrated framework of Agency, Stakeholder, and Stewardship Theories. Results: Non-profit ownership (β = .245, p < .001) and higher board independence (β = .182, p < .01) were significantly associated with superior care quality. CEO duality negatively predicted quality (β = –.146, p < .01). Quality-linked managerial incentives had a positive effect (β = .168, p < .01). Board size exhibited an inverted U-shaped relationship with care quality. SEM confirmed that staffing ratios partially mediated the governance–quality relationship (Non-Profit → Staffing → Quality: Estimate = .083, 95% CI [.051, .118]). Conclusions: Governance models are foundational determinants of LTC care quality. Non-profit ownership, independent boards, separated executive roles, and quality-aligned incentives promote better resident outcomes, primarily through higher staffing investment. Structural governance reforms are essential for sustainable, high-quality care.