While the structure, process, and outcome taxon omy has long been used in the field of health care quality measurement and evaluation, it has not been used in a true causal model which assesses facility level quality. Total quality management and contin uous quality improvement call for routinely assessing facility and resident level quality in a causal frame work. This paper presents a causal modeling meth odology as a more appropriate method for assessing and understanding the inter-relatedness among each of the quality dimensions of Nursing Facility care, and presents how such a causal model directly relates to the notion of continuous quality improvement. The methodology consists of five steps: (1) sample defini tion and data collection, (2) data reduction through factor analysis, (3) development and testing of a causal model through path analysis, (4) identification of patterns of care through cluster analysis, and (5) integration of the model to both continuous quality improvement and to complex relationships involving quality and organizational variables. The methodol ogy is fully illustrated by using a sample of 104 nursing facilities in Wisconsin in which quality di mensions have been captured through the Quality Assessment Index. The analysis demonstrates that nursing facilities may be substantially benefited by having access to causal linkages which materially affect outcome quality. Management would then have first-hand knowledge of the structural characteris tics and the process activities that they may pursue in order to improve outcome quality.