Case mix indicates, for a resident population, the degree of risk for developing favorable or unfavorable outcomes. In a study of 164 nursing homes, we explored two methods for combining resident assessment data into a case mix index (CMI). We compared a facility-level, composite CMI to a prevalence-based CMI comprised of 22 separate resident characteristics for their adequacy in explaining resident outcomes. The prevalence-based CMI consistently explained more variance in outcomes than the facility level, composite CMI. This study indicates a reasonable method for using administrative databases containing resident assessment data to adjust for the influence of case mix on nursing home resident outcomes.