The US’s for-profit hospital sector concentration

La concentration du secteur hospitalier à but lucratif aux États-Unis

Laura Alles ()
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Laura Alles: CEPN - Centre d'Economie de l'Université Paris Nord - Université Sorbonne Paris Nord

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Abstract: Concentration in the for-profit hospital sector is an international phenomenon. Given its limited exploration in French economic literature, our focus here is on the most extensively studied country: the United States, where the integration process began in the early 1960s. Neoclassical literature perceives concentration as a means to achieve a second-best equilibrium in a market that is imperfect due to the specific characteristics of healthcare. Concentration results from the implementation of "social institutions" aimed at approaching this second-order equilibrium. Empirical studies seek to assess the improved efficiency derived from concentration: While concentration reduces costs, the origins of this consequence remain poorly understood; moreover, reduced costs do not result in price cuts, instead, hospitals and groups often gain market power, leading to the opposite effect. Political economy studies for-profit hospital development and concentration as the result of relatively advantageous institutional conditions, especially through generous payments. Freedom of exercise allows for-profit hospitals to evolve through tariff regulation as a consequence of distributional conflicts.

Keywords: Neoclassical theory; Political economy; Imperfect market; For-profit hospital; Économie politique; Marché imparfait; Théorie néoclassique; Concentration; Hôpital à but lucratif (search for similar items in EconPapers)
Date: 2024-07-31
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Published in European Review of Service Economics and Management, 2024, 2024-1 (17), pp.89-118. ⟨10.48611/isbn.978-2-406-17198-0.p.0089⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05556445

DOI: 10.48611/isbn.978-2-406-17198-0.p.0089

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