This research study utilizes indicators from federal and state surveys to evaluate variation in outcomes in 438 Medicare certified skilled nursing care facilities in Pennsylvania. First, a standardization function adjusting for patient characteristics known to influence outcomes was developed and estimated. The relationships between organizational and environmental characteristics and the chosen outcome indicators (i.e., differences between the actual and expected rate of mortality, pressure ulcers, urethral catheterization and physical restraints) were then analyzed by weighted least squares regression. Results suggest considerable interfacility variation in rates for these outcome indicators. A portion of this variation is significantly attributable to resident characteristics (P < or = 0.05). However, variation in outcomes in Pennsylvania facilities is also associated with facility characteristics (e.g., size and for-profit status), and environmental characteristics (e.g., per capita income and bed supply). Implications for nursing home management and policy are considered.