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Value of new performance information in healthcare: evidence from Japan

Author

Listed:
  • Susanna Gallani

    (Harvard Business School)

  • Takehisa Kajiwara

    (Kobe University)

  • Ranjani Krishnan

    (Michigan State University)

Abstract

Mandatory measurement and disclosure of outcome measures are commonly used policy tools in healthcare. The effectiveness of such disclosures relies on the extent to which the new information produced by the mandatory system is internalized by the healthcare organization and influences its operations and decision-making processes. We use panel data from the Japanese National Hospital Organization to analyze performance improvements following regulation mandating standardized measurement and peer disclosure of patient satisfaction performance. Drawing on value of information theory, we document the absolute value and the benchmarking value of new information for future performance. Controlling for ceiling effects in the opportunities for improvement, we find that the new patient satisfaction measurement system introduced positive, significant, and persistent mean shifts in performance (absolute value of information) with larger improvements for poorly performing hospitals (benchmarking value of information). Our setting allows us to explore these effects in the absence of confounding factors such as incentive compensation or demand pressures. The largest positive effects occur in the initial period, and improvements diminish over time, especially for hospitals with poorer baseline performance. Our study provides empirical evidence that disclosure of patient satisfaction performance information has value to hospital decision makers.

Suggested Citation

  • Susanna Gallani & Takehisa Kajiwara & Ranjani Krishnan, 2020. "Value of new performance information in healthcare: evidence from Japan," International Journal of Health Economics and Management, Springer, vol. 20(4), pages 319-357, December.
  • Handle: RePEc:kap:ijhcfe:v:20:y:2020:i:4:d:10.1007_s10754-020-09283-1
    DOI: 10.1007/s10754-020-09283-1
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Chris Sampson’s journal round-up for 9th November 2020
      by Chris Sampson in The Academic Health Economists' Blog on 2020-11-09 12:00:00

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    More about this item

    Keywords

    Value of information; Feedback; Patient satisfaction; Healthcare;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • M16 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - International Business Administration
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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