The present study investigated the consequences of ignoring a nested data structure on the Rasch/one parameter item response theory model. Although most large-scale educational assessment data do exhibit a nested data structure, current practice often ignores such data structure and applies the standard Rasch/IRT models to conduct measurement analyses. We hypothesized that this practice would produce negative consequences on the item parameter estimates. Using simulation, we investigated this hypothesis by comparing the results from an incorrectly specified two level model which ignored the nested data structure to those from a correctly specified three-level hierarchical generalized linear model. Use of the incorrect two-level model did, in fact, result in negative consequences in estimating the standard errors, although the point estimates were unbiased and identical to the ones from the three-level analysis. A real data set from the IEA Civic education study in 1999 was used to illustrate the simulation results.