Physician investment in hospitals: Specialization, selection, and quality in cardiac care

Ashley Swanson

Journal of Health Economics, 2021, vol. 80, issue C

Abstract: Physician ownership of hospitals involves several competing economic forces. Physician-owners may be incentivized to “cherry-pick” and treat profitable patients at their facilities. However, physician-owned hospitals are often specialized and may provide higher-quality care for well-matched patients. Using multiple identification approaches, I document no significant mortality improvement for cardiac patients treated at physician-owned hospitals. Using aggregate data on ownership to infer physician-owner preferences in a hospital choice model, my results rule out significant cherry-picking within physician-owners’ patient populations. However, both facility location and a healthier overall patient population among physician-owners drive advantageous selection of patients into physician-owned hospitals.

Keywords: Specialization; Vertical integration; Physician ownership; Hospital quality (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:80:y:2021:i:c:s0167629621001041

DOI: 10.1016/j.jhealeco.2021.102519

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