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Start spreading the news: A structural estimate of the effects of New York hospital report cards

David Dranove and Andrew Sfekas

Journal of Health Economics, 2008, vol. 27, issue 5, 1201-1207

Abstract: Research on the effects of publicly reported hospital quality report cards on patient market shares is mixed. Higher-ranking hospitals do not consistently experience increases in market share. We argue that this may be because the report cards do not always convey "news" about quality; in some cases the rankings conform with prior beliefs about quality. We develop a structural model of the "news" in report cards and estimate the model using data from New York State in 1989-1991. We show hospitals with negative news in the original 1990 report cards experienced a decrease in market share, but that a misspecified model might continue to find no report card effect.

Date: 2008
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Citations: View citations in EconPapers (58)

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Journal of Health Economics is currently edited by J. P. Newhouse, A. J. Culyer, R. Frank, K. Claxton and T. McGuire

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