How is the growth in assisted living linked with decreased occupancy rates, increased resident acuity, and increased resident reliance on Medicaid in nursing homes? In particular, the researchers: 1) documented the growth of the assisted living sector over time; 2) isolated the effect of assisted living growth on nursing home utilization; 3) examined the relationship between assisted living growth and nursing home payer mix; 4) estimated the effect of assisted living growth on nursing home resident acuity; and 5) assessed whether the growth in assisted living has implications for nursing home quality. They also established a national assisted living database to facilitate empirical work to isolate the effect of assisted living growth on the nursing home market. The objective of the project was to better inform policymakers as they address the best incentives for meeting the nation’s growing long-term care needs, at reasonable cost, in a dynamic market.