Physician Market Power and Medical-Care Expenditures

Abe Dunn and Adam Shapiro

BEA Working Papers from Bureau of Economic Analysis

Abstract: We study the degree to which greater physician market power via consolidation leads to higher service prices in the commercially insured medical-care market. We also examine whether these potentially higher service prices translate into different levels of physician service utilization. We find that physicians in more concentrated markets charge higher service prices. However, due to the unique nature of patient cost sharing as well as the incentives of physicians, these higher prices lead to either no change or, in some cases, an expansion of services. This is in contrast to a typical market, where higher prices attributable to consolidation are thought to decrease quantity demanded.

JEL-codes: E6 (search for similar items in EconPapers)
Date: 2012-04
New Economics Papers: this item is included in nep-com and nep-hme
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Citations: View citations in EconPapers (14)

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Related works:
Working Paper: Physician Market Power and Medical-Care Expenditures (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:bea:wpaper:0084

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