IDEAS home Printed from https://ideas.repec.org/a/eee/chieco/v27y2013icp1-14.html
   My bibliography  Save this article

How does separating government regulatory and operational control of public hospitals matter to healthcare supply?

Author

Listed:
  • Pan, Jay
  • Liu, Gordon G.
  • Gao, Chen

Abstract

This paper evaluates the effect of regulatory reform separating the operational control and regulatory oversight of public hospitals in China. Using city-level data and a difference-in-difference (DID) model, this paper estimates the changes in healthcare supply in response to the regulatory reform. Based on the DID estimates, in Weifang between 2006 and 2008, the reform led to a 39.3% increase in the number of doctors per 10,000 residents and 40.1% increase in the number of health workers per 10,000 residents. Similarly, in Suzhou between 2005 and 2008 the reform led to increases of 60.5%, 30.8% and 36.6% for hospital beds, doctors and health workers per 10,000 people, respectively. Moreover, the magnitude of this impact appears to increase over time. Furthermore, the effect of the reform is consistent regardless of whether the separation reform takes place inside or outside the government. These findings lead us to conclude that the government should focus only on the regulation of healthcare markets, while leaving hospital operation to the free market.

Suggested Citation

  • Pan, Jay & Liu, Gordon G. & Gao, Chen, 2013. "How does separating government regulatory and operational control of public hospitals matter to healthcare supply?," China Economic Review, Elsevier, vol. 27(C), pages 1-14.
    • Handle: RePEc:eee:chieco:v:27:y:2013:i:c:p:1-14
    DOI: 10.1016/j.chieco.2013.07.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1043951X13000448
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.chieco.2013.07.002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Zhang, Xiaobo & Kanbur, Ravi, 2005. "Spatial inequality in education and health care in China," China Economic Review, Elsevier, vol. 16(2), pages 189-204.
    2. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," Working Papers 680, Princeton University, Department of Economics, Industrial Relations Section..
    3. Gaynor, Martin & Town, Robert J., 2011. "Competition in Health Care Markets," Handbook of Health Economics, in: Mark V. Pauly & Thomas G. Mcguire & Pedro P. Barros (ed.), Handbook of Health Economics, volume 2, chapter 0, pages 499-637, Elsevier.
    4. Yip, Winnie & Hsiao, William, 2009. "China's health care reform: A tentative assessment," China Economic Review, Elsevier, vol. 20(4), pages 613-619, December.
    5. Dong, Keyong, 2009. "Medical insurance system evolution in China," China Economic Review, Elsevier, vol. 20(4), pages 591-597, December.
    6. Karen Eggleston & Li Ling & Meng Qingyue & Magnus Lindelow & Adam Wagstaff, 2008. "Health service delivery in China: a literature review," Health Economics, John Wiley & Sons, Ltd., vol. 17(2), pages 149-165, February.
    7. Gustafsson, Bjorn & Li, Shi, 2004. "Expenditures on education and health care and poverty in rural China," China Economic Review, Elsevier, vol. 15(3), pages 292-301.
    8. Zack Cooper & Stephen Gibbons & Simon Jones & Alistair McGuire, 2011. "Does Hospital Competition Save Lives? Evidence From The English NHS Patient Choice Reforms," Economic Journal, Royal Economic Society, vol. 121(554), pages 228-260, August.
    9. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," ILR Review, Cornell University, ILR School, vol. 46(1), pages 22-37, October.
    10. repec:fth:prinin:300 is not listed on IDEAS
    11. World Bank, 2010. "Fixing the Public Hospital System in China," World Bank Publications - Reports 27720, The World Bank Group.
    12. Liu, Gordon G. & Li, Lin & Hou, Xiaohui & Xu, Judy & Hyslop, Daniel, 2009. "The role of for-profit hospitals in medical expenditures: Evidence from aggregate data in China," China Economic Review, Elsevier, vol. 20(4), pages 625-633, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pan, Jay & Qin, Xuezheng & Li, Qian & Messina, Joseph P. & Delamater, Paul L., 2015. "Does hospital competition improve health care delivery in China?," China Economic Review, Elsevier, vol. 33(C), pages 179-199.
    2. Gao, Chen & Xu, Fei & Liu, Gordon G., 2014. "Payment reform and changes in health care in China," Social Science & Medicine, Elsevier, vol. 111(C), pages 10-16.
    3. Qikang Zhong & Zhe Li & Yujing He, 2023. "Coupling Evaluation and Spatial–Temporal Evolution of Land Ecosystem Services and Economic–Social Development in a City Group: The Case Study of the Chengdu–Chongqing City Group," IJERPH, MDPI, vol. 20(6), pages 1-29, March.
    4. Lu, Liyong & Pan, Jay, 2019. "The association of hospital competition with inpatient costs of stroke: Evidence from China," Social Science & Medicine, Elsevier, vol. 230(C), pages 234-245.
    5. Sheng Nong & Nengliang Aaron Yao, 2019. "Reasons behind stymied public hospital governance reform in China," PLOS ONE, Public Library of Science, vol. 14(9), pages 1-11, September.
    6. Liyong Lu & Jay Pan, 2021. "Does hospital competition lead to medical equipment expansion? Evidence on the medical arms race," Health Care Management Science, Springer, vol. 24(3), pages 582-596, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pan, Jay & Qin, Xuezheng & Li, Qian & Messina, Joseph P. & Delamater, Paul L., 2015. "Does hospital competition improve health care delivery in China?," China Economic Review, Elsevier, vol. 33(C), pages 179-199.
    2. Moscelli, Giuseppe & Gravelle, Hugh & Siciliani, Luigi, 2023. "The effect of hospital choice and competition on inequalities in waiting times," Journal of Economic Behavior & Organization, Elsevier, vol. 205(C), pages 169-201.
    3. Cheung, Diana & Padieu, Ysaline, 2015. "Heterogeneity of the Effects of Health Insurance on Household Savings: Evidence from Rural China," World Development, Elsevier, vol. 66(C), pages 84-103.
    4. Lea Immel, 2021. "The Impact of Labor Market Reforms on Income Inequality: Evidence from the German Hartz Reforms," ifo Working Paper Series 347, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    5. 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 134-166, November.
    6. Zack Cooper & Stephen Gibbons & Simon Jones & Alistair McGuire, 2011. "Does Hospital Competition Save Lives? Evidence From The English NHS Patient Choice Reforms," Economic Journal, Royal Economic Society, vol. 121(554), pages 228-260, August.
    7. Lu, Liyong & Pan, Jay, 2019. "The association of hospital competition with inpatient costs of stroke: Evidence from China," Social Science & Medicine, Elsevier, vol. 230(C), pages 234-245.
    8. Cooper, Zack & Gibbons, Stephen & Jones, Simon & McGuire, Alistair, 2010. "Does hospital competition improve efficiency? An analysis of the recent market-based reforms to the English NHS," LSE Research Online Documents on Economics 28578, London School of Economics and Political Science, LSE Library.
    9. Hu, Hsin-Hui & Qi, Qinghui & Yang, Chih-Hai, 2012. "Analysis of hospital technical efficiency in China: Effect of health insurance reform," China Economic Review, Elsevier, vol. 23(4), pages 865-877.
    10. Giuseppe Moscelli & Hugh Gravelle & Luigi Siciliani, 2018. "Effects of Market Structure and Patient Choice on Hospital Quality for Planned Patients," School of Economics Discussion Papers 1118, School of Economics, University of Surrey.
    11. Moscelli, Giuseppe & Gravelle, Hugh & Siciliani, Luigi & Santos, Rita, 2018. "Heterogeneous effects of patient choice and hospital competition on mortality," Social Science & Medicine, Elsevier, vol. 216(C), pages 50-58.
    12. Hugh Gravelle & Giuseppe Moscelli & Rita Santos & Luigi Siciliani, 2014. "Patient choice and the effects of hospital market structure on mortality for AMI, hip fracture and stroke patients," Working Papers 106cherp, Centre for Health Economics, University of York.
    13. Kejia Chu & Ning Zhang & Zhongfei Chen, 2015. "The Efficiency and Its Determinants for China’s Medical Care System: Some Policy Implications for Northeast Asia," Sustainability, MDPI, vol. 7(10), pages 1-20, October.
    14. Giuseppe Moscelli & Hugh Gravelle & Luigi Siciliani, 2021. "Hospital competition and quality for non‐emergency patients in the English NHS," RAND Journal of Economics, RAND Corporation, vol. 52(2), pages 382-414, June.
    15. Guanfu Fang & Hui Cao, 2020. "State versus private provision: How does China’s market‐oriented reform affect healthcare delivery?," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 28(3), pages 381-411, July.
    16. Liu, Hong & Gao, Song & Rizzo, John A., 2011. "The expansion of public health insurance and the demand for private health insurance in rural China," China Economic Review, Elsevier, vol. 22(1), pages 28-41, March.
    17. Fogelberg, Sara, 2013. "Effects of Competition between Healthcare Providers on Prescription of Antibiotics," Working Paper Series 949, Research Institute of Industrial Economics, revised 20 Nov 2014.
    18. Zsófia L. Bárány, 2016. "The Minimum Wage and Inequality: The Effects of Education and Technology," Journal of Labor Economics, University of Chicago Press, vol. 34(1), pages 237-274.
    19. David Card, 2022. "Design-Based Research in Empirical Microeconomics," American Economic Review, American Economic Association, vol. 112(6), pages 1773-1781, June.
    20. Caliendo, Marco & Wittbrodt, Linda, 2022. "Did the minimum wage reduce the gender wage gap in Germany?," Labour Economics, Elsevier, vol. 78(C).

    More about this item

    Keywords

    Public hospital; Separation; Healthcare supply; Healthcare reform; China;
    All these keywords.

    JEL classification:

    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • P36 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:chieco:v:27:y:2013:i:c:p:1-14. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/chieco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.