ObjectiveTo estimate differences in facility‐level outcomes between nursing homes which reached Institutional Special Needs Plan (I‐SNP) maturity and those which never cared for I‐SNP enrollees.Study Setting and DesignWe used a difference‐in‐differences design to estimate the effect of I‐SNP maturity, defined as having at least 33.75% of Medicare long‐stayers in the nursing home enrolled in any I‐SNP. Our main outcome was the hospitalization rate in each nursing home‐year. Secondary outcomes included the share of residents with medication use, fall, urinary tract infection, catheter insertion, pressure ulcer, physical restraint use, increased need for help with activities of daily living (ADLs), and mortality.Data Sources and Analytic SampleThis repeated cross‐sectional study used 100% Medicare claims, Minimum Data Set assessments, and publicly available Medicare Advantage (MA) plan characteristics data (2004–2021). We included all MA beneficiaries who resided in US nursing homes which reached I‐SNP maturity and those without I‐SNP enrollees.Principal FindingsWe identified 2530 nursing homes which reached I‐SNP maturity (treated) and 9830 nursing homes without I‐SNP enrollees (untreated). There were some differences observed between these nursing homes, including shares of residents who were White (76.42% vs. 84.84%) and on Medicaid (66.94% vs. 55.45%). These nursing homes were also larger on average (141.76 beds vs. 87.56 beds). From the difference‐in‐differences model, nursing homes which reached I‐SNP maturity experienced declines of 4.1 percentage points (pp) for hospitalizations, 1.0 pp for pressure ulcers, 1.3 pp for urinary tract infections (p < 0.001) alongside increases in the need for help with ADLs, use of antipsychotics, falls, and physical restraints.ConclusionsNursing homes which reached I‐SNP maturity experienced fewer hospitalizations and pressure ulcers but a decline in function and increase in other negative outcomes. I‐SNPs may be a promising model to improve care for long‐stay residents, but more research is needed to understand potential adverse consequences.