Do consumers respond to publicly reported quality information? Evidence from nursing homes
AbstractPublic reporting of quality information is designed to address information asymmetry in health care markets. Without public reporting, consumers may have little information to help them differentiate quality among providers, giving providers little incentive to compete on quality. Public reporting enables consumers to choose highly ranked providers. Using a four-year (2000–2003) panel dataset, we examine the relationship between report card scores and patient choice of nursing home after the Centers for Medicare and Medicaid Services began publicly reporting nursing home quality information on post-acute care in 2002. We find that the relationship between reported quality and nursing home choice is positive and statistically significant suggesting that patients were more likely to choose facilities with higher reported post-acute care quality after public reporting was initiated. However, the magnitude of the effect was small. We conclude that there has been minimal consumer response to information in the post-acute care market.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of Health Economics.
Volume (Year): 31 (2012)
Issue (Month): 1 ()
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505560
Report cards; Quality information; Nursing home care; Nursing home demand;
Find related papers by JEL classification:
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
- I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Cutler, David & Landrum, Mary Beth & Huckman, Robert, 2004. "The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery," Scholarly Articles 2640582, Harvard University Department of Economics.
- Wedig, Gerard J. & Tai-Seale, Ming, 2002. "The effect of report cards on consumer choice in the health insurance market," Journal of Health Economics, Elsevier, vol. 21(6), pages 1031-1048, November.
- David M. Cutler & Robert S. Huckman & Mary Beth Landrum, 2004.
"The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery,"
NBER Working Papers
10489, National Bureau of Economic Research, Inc.
- David M. Cutler & Robert S. Ilckman & Mary Beth Landrum, 2004. "The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery," American Economic Review, American Economic Association, vol. 94(2), pages 342-346, May.
- Bundorf, M. Kate & Chun, Natalie & Goda, Gopi Shah & Kessler, Daniel P., 2009.
"Do markets respond to quality information? The case of fertility clinics,"
Journal of Health Economics,
Elsevier, vol. 28(3), pages 718-727, May.
- M. Kate Bundorf & Natalie Chun & Gopi Shah Goda & Daniel P. Kessler, 2008. "Do Markets Respond to Quality Information? The Case of Fertility Clinics," NBER Working Papers 13888, National Bureau of Economic Research, Inc.
- Jin, Ginger Zhe & Sorensen, Alan T., 2006. "Information and consumer choice: The value of publicized health plan ratings," Journal of Health Economics, Elsevier, vol. 25(2), pages 248-275, March.
- Steven T. Berry, 1994. "Estimating Discrete-Choice Models of Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 242-262, Summer.
- Van Houtven, Courtney Harold & Norton, Edward C., 2008. "Informal care and Medicare expenditures: Testing for heterogeneous treatment effects," Journal of Health Economics, Elsevier, vol. 27(1), pages 134-156, January.
- Van Houtven, Courtney Harold & Norton, Edward C., 2004. "Informal care and health care use of older adults," Journal of Health Economics, Elsevier, vol. 23(6), pages 1159-1180, November.
- Leemore Dafny & David Dranove, 2005.
"Do Report Cards Tell Consumers Anything They Don't Already Know? The Case of Medicare HMOs,"
NBER Working Papers
11420, National Bureau of Economic Research, Inc.
- Leemore Dafny & David Dranove, 2008. "Do report cards tell consumers anything they don't already know? The case of Medicare HMOs," RAND Journal of Economics, RAND Corporation, vol. 39(3), pages 790-821.
- Chernew, Michael & Gowrisankaran, Gautam & Scanlon, Dennis P., 2008. "Learning and the value of information: Evidence from health plan report cards," Journal of Econometrics, Elsevier, vol. 144(1), pages 156-174, May.
- Dranove, David & Sfekas, Andrew, 2008. "Start spreading the news: A structural estimate of the effects of New York hospital report cards," Journal of Health Economics, Elsevier, vol. 27(5), pages 1201-1207, September.
- Norton, Edward C., 2000. "Long-term care," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 17, pages 955-994 Elsevier.
- Hendrik Schmitz & Magdalena Stroka, 2014. "Do Elderly Choose Nursing Homes by Quality, Price or Location?," Ruhr Economic Papers 0495, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
- Filistrucchi, L. & Ozbugday, F.C., 2012.
"Mandatory Quality Disclosure and Quality Supply: Evidence from German Hospitals,"
2012-031, Tilburg University, Tilburg Law and Economic Center.
- Filistrucchi, L. & Ozbugday, F.C., 2012. "Mandatory Quality Disclosure and Quality Supply: Evidence from German Hospitals," Discussion Paper 2012-070, Tilburg University, Center for Economic Research.
- Lapo Filistrucchi & Fatih Cemil Ozbugday, 2012. "Mandatory Quality Disclosure and Quality Supply: Evidence from German Hospitals," Working Papers - Economics wp2012_16.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
- Ozbugday, F.C., 2012. "Empirical essays on ex post evaluations of competition and regulatory authorities decisions and policy reforms," Open Access publications from Tilburg University urn:nbn:nl:ui:12-5660518, Tilburg University.
- Konetzka, R. Tamara & Polsky, Daniel & Werner, Rachel M., 2013. "Shipping out instead of shaping up: Rehospitalization from nursing homes as an unintended effect of public reporting," Journal of Health Economics, Elsevier, vol. 32(2), pages 341-352.
If references are entirely missing, you can add them using this form.