Death by Market Power: Reform, Competition and Patient Outcomes in the National Health Service

Martin Gaynor, Rodrigo Moreno-Serra () and Carol Propper

No 16164, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The effect of competition on the quality of health care remains a contested issue. Most empirical estimates rely on inference from non experimental data. In contrast, this paper exploits a pro-competitive policy reform to provide estimates of the impact of competition on hospital outcomes. The English government introduced a policy in 2006 to promote competition between hospitals. Patients were given choice of location for hospital care and provided information on the quality and timeliness of care. Prices, previously negotiated between buyer and seller, were set centrally under a DRG type system. Using this policy to implement a difference-in-differences research design we estimate the impact of the introduction of competition on not only clinical outcomes but also productivity and expenditure. Our data set is large, containing information on approximately 68,000 discharges per year per hospital from 162 hospitals. We find that the effect of competition is to save lives without raising costs. Patients discharged from hospitals located in markets where competition was more feasible were less likely to die, had shorter length of stay and were treated at the same cost.

JEL-codes: I11 I18 L13 L32 (search for similar items in EconPapers)
Date: 2010-07
New Economics Papers: this item is included in nep-com, nep-hea and nep-reg
Note: EH
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Citations: View citations in EconPapers (70)

Published as Martin Gaynor & Rodrigo Moreno-Serra & Carol Propper, 2013. "Death by Market Power: Reform, Competition, and Patient Outcomes in the National Health Service," American Economic Journal: Economic Policy, American Economic Association, vol. 5(4), pages 134-66, November.

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Related works:
Journal Article: Death by Market Power: Reform, Competition, and Patient Outcomes in the National Health Service (2013)
Working Paper: Death by Market Power: Reform, Competition and Patient Outcomes in the National Health Service (2011)
Working Paper: Death by Market Power. Reform, Competition and Patient Outcomes in the National Health Service (2010)
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