Hospital Quality and Demand: An Analysis of German Hospitals Using Distance-Metric Approach

Abstract

In this paper, we estimate an aggregate demand model for German hospitals using various quality measures extracted from mandatory quality reports. In doing so, we adopt the Distance-Metric approach. The estimates suggest that demand in obstetrics field is responsive to some measures of clinical quality. Finally, the results indicate weak spillovers in hospital demand arising from the clinical quality of closer competitors

Keywords

• Health care market, quality competition, distance metric, Germany

Hastane Kalitesi ve Talep: Mesafe-Metriği Yaklaşımıyla Alman Hastanelerinin Bir Analizi

Abstract

Bu makalede, zorunlu olarak yayımlanan kalite raporlarından elde edilen çeşitli kalite ölçüleri kullanılarak, Alman hastaneleri için bir toplam talep modeli tahmin edilmiştir. Bu tahmin yapılırken, Mesafe-Metriği yaklaşımı benimsenmiştir. Sonuçlara göre, kadın doğum alanında talep, bazı klinik kalite ölçülerine karşı duyarlıdır. Son olarak ampirik sonuçlar hastane talebinde, yakınlardaki rakip hastanelerin klinik kalitesinden ortaya çıkan zayıf taşma etkilerine işaret etmektedir

Keywords

• Sağlık hizmetleri piyasası, kalite rekabeti, mesafe metriği, Almanya

References

1. Baker, J.B. (1988) “The Antitrust Analysis of Hospital Mergers and the Transformation of the Hospital Industry” Law and Contemporary Problems, 51(2): 96- 164.
2. Beckert, W., Christensen, M. and Collyer, K. (2012). “Choice of NHS‐funded Hospital Services in England” Economic Journal, 122(560): 400-417.
3. Berry, S. (1994) “Estimating Discrete-Choice Models of Product Differentiation” RAND Journal of Economics, 25(2): 242-262.
4. Berry, S., Levinsohn, J. and Pakes, A. (1995) “Automobile Prices in Market Equilibrium” Econometrica, 63(4): 841-890.
5. Brook, R.H. and Kosecoff, J.B. (1988) “Commentary: Competition and Quality” Health Affairs, 7: 150-162. Bundorf, M.K., Chun, N., Goda, G.S. and Kessler, D.P. (2009). “Do Markets Respond to Quality Information? The Case of Fertility Clinics”Journal of Health Economics, 28(3): 718-727.
6. Busse, R., Nimptsch, U. and Mansky, M. (2009) “Measuring, Monitoring, and Managing Quality in Germany’s Hospitals” Health Affairs, 28(2): 294-304.
7. Dranove, D.D., Shanley, M. and Simon, C. (1992) “Is Hospital Competition Wasteful?” RAND Journal of Economics, 23(2): 247–262.
8. Dranove, D.D. and Sattertwaite, M.A. (1992) “Monopolistic Competition when Price and Quality are Imperfectly Observable” RAND Journal of Economics, 23(4):518–534.

9. Gaynor, M. (1994) “Issues in the Industrial Organization of the Market for Physician Services” Journal of Economics and Management Strategy, 3(1): 211-255.
10. Gaynor, M. and Vogt, W.B. (2000) “Antitrust and Competition in Health Care Markets” Culyer, A.J. and Newhouse, J.P. (eds.) Handbook of Health Economics, Elsevier Science, North-Holland.
11. Gaynor, M., Propper, C. and Seiler, S. (2012). “Free to choose? Reform and demand response in the English National Health Service”National Bureau of Economic Research, No. w18574.
12. Ginsburg, P.B. and Hammons, G.T. (1988) “Competition and the Quality of Care: The Importance of Information” Inquiry, 25: 108-115.
13. Gutacker, N., Siciliani, L., Moscelli, G. and Gravelle, H. (2016). “Choice of Hospital: Which Type of Quality Matters?”Journal of Health Economics, 50: 230-246. Herr, A. (2008) “Cost and Technical Efficiency of German Hospitals: Does Ownership Matter?” Health Economics, 17: 1057-1071.
14. McConnell, K.J., Lindrooth, R.C., Wholey, D.R., Maddox, T.M. and Bloom, N. (2016). “Modern Management Practices and Hospital Admissions”Health Economics, 25(4): 470-485.
15. Moscone, F., Tosetti, E. and Vittadini, G. (2012). “Social Interaction in Patients’ Hospital Choice: Evidence from Italy”Journal of the Royal Statistical Society: Series A (Statistics in Society), 175(2): 453-472.
16. Pinkse, J., Slade, M.E. and Brett, C. (2002) “Spatial Price Competition: A Semiparametric Approach” Econometrica, 70(3): 1111-1153.
17. Pope, D.G. (2009). “Reacting to Rankings: Evidence from “America’s Best Hospitals””Journal of Health Economics, 28(6): 1154-1165.
18. Robinson, J.C. and Luft, H.S. (1985) “The Impact of Hospital Market Structure on Patient Volume, Average Fatih Cemil ÖZBUĞDAY 504 Length of Stay, and the Cost of Care” Journal of Health Economics, 4(4): 333-356.
19. Ruwaard, S. and Douven, R. (2014). “Quality and Hospital Choice for Cataract Treatments: The Winner Takes Most”CPB Netherlands Bureau for Economic Policy Analysis, No. 272.
20. Stiles, A.D. (2007) “Prenatal Corticosteroids - Early Gain, Long-Term Questions” New England Journal of Medicine, 357: 1248-1250.
21. Tay, A. (2003) “Assessing Competition in Hospital Care Markets: The Importance of Accounting for Quality Differentiation” RAND Journal of Economics, 34(4):786–814.
22. Varkevisser, M., van der Geest, S. A. and Schut, F. T. (2012). “Do Patients Choose Hospitals with High Quality Ratings? Empirical Evidence from the Market for Angioplasty in the Netherlands”Journal of Health Economics, 31(2): 371-378