Traditional familial care has been challenged due to the reduction of family size and increased mobility of the Chinese population. Institutional elder care is increasingly becoming an alternative to familial care. This study explores the relationship between ownership of elder care home and care quality, using data collected in 2010 from 157 homes in Tianjin. Two hypotheses were proposed for the study: 1) There is a difference between government and non government-owned facilities in facility characteristics; 2) Government-owned facilities have better care quality outcomes. The t-test results showed that government-owned elder care homes had advantages in economic resources, staffing and the availability of services. Government-owned facilities reported lower mortality rate compared to non government-owned facilities. Multi-variant regression analysis showed that economic resources—whether funding from the government or high payments from care-recipients in private facilities--are important factors predicting higher levels of care quality. These results indicate that the Chinese government continues to play an important role in institutional long term care; in the meantime, private market is increasing its prominence in the long term care market.