Hospital ownership, reimbursement systems and mortality rates
This paper analyses the effect of ownership and system of reimbursement on mortality rates. From the statistical results we could conclude that the incentive created by fee-for-service reimbursement yields a four-point reduction in the mortality rate. However, this ranking of hospital quality is completely dependent on the characteristics and illness severity of patients. To take this difficulty into account, we use an innovative duration model applied to panel data: a duration model with both patient and hospital unobserved heterogeneity. No distributional assumptions are made regarding the latter. By this way, we control the fact that patients admitted to the private sector can be different in terms of disease severity from patients admitted to the public sector. The capacity to perform innovative procedures has more effect on the mortality than the system of reimbursement and|or ownership. As such, private sector hospitals that perform more innovative procedures provide a better quality of care, measured by the probability of dying. Nevertheless, heterogeneity within hospitals is greater in for-profit hospitals than in other types of hospital. This suggests that, by choosing a for-profit hospital, patients have on average a lower instantaneous probability of dying but are less sure about the quality of the hospital. Copyright © 2005 John Wiley & Sons, Ltd.
Volume (Year): 14 (2005)
Issue (Month): 11 ()
|Contact details of provider:|| Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749|
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.:
- Sloan, Frank A. & Picone, Gabriel A. & Taylor, Donald H., Jr. & Chou, Shin-Yi, 2000.
"Hospital Ownership and Cost and Quality of Care: Is There a Dime's Worth of Difference?,"
00-11, Duke University, Department of Economics.
- Sloan, Frank A. & Picone, Gabriel A. & TaylorJr., Donald H. & Chou, Shin-Yi, 2001. "Hospital ownership and cost and quality of care: is there a dime's worth of difference?," Journal of Health Economics, Elsevier, vol. 20(1), pages 1-21, January.
- Frank A. Sloan & Gabriel A. Picone & Donald H. Taylor, Jr. & Shin-Yi Chou, 1998. "Hospital Ownership and Cost and Quality of Care: Is There a Dime's Worth of Difference?," NBER Working Papers 6706, National Bureau of Economic Research, Inc.
- Gabriel Picone & Shin-Yi Chou & Frank Sloan, 2002. "Are For-Profit Hospital Conversions Harmful to Patients and to Medicare?," RAND Journal of Economics, The RAND Corporation, vol. 33(3), pages 507-523, Autumn.
- Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
- Mark B. McClellan & Douglas O. Staiger, 2000.
"Comparing Hospital Quality at For-Profit and Not- for-Profit Hospitals,"
in: The Changing Hospital Industry: Comparing For-Profit and Not-for-Profit Institutions, pages 93-112
National Bureau of Economic Research, Inc.
- Mark McClellan & Douglas Staiger, 1999. "Comparing Hospital Quality at For-Profit and Not-for-Profit Hospitals," NBER Working Papers 7324, National Bureau of Economic Research, Inc.
- John F. Geweke & Gautam Gowrisankaran & Robert J. Town, 2002.
"Bayesian inference for hospital quality in a selection model,"
Working Paper Series
2002-18, Federal Reserve Bank of San Francisco.
- John Geweke & Gautam Gowrisankaran & Robert J. Town, 2003. "Bayesian Inference for Hospital Quality in a Selection Model," Econometrica, Econometric Society, vol. 71(4), pages 1215-1238, 07.
- John Geweke & Gautam Gowrisankaran & Robert J. Town, 2001. "Bayesian Inference for Hospital Quality in a Selection Model," NBER Working Papers 8497, National Bureau of Economic Research, Inc.
- Daniel P. Kessler & Mark B. McClellan, 2000. "Is Hospital Competition Socially Wasteful?," The Quarterly Journal of Economics, Oxford University Press, vol. 115(2), pages 577-615.
- Barton H. Hamilton & Vivian H. Hamilton, 1997. "Estimating surgical volume-outcome relationships applying survival models: accounting for frailty and hospital fixed effects," Health Economics, John Wiley & Sons, Ltd., vol. 6(4), pages 383-395.
- Joel L. Horowitz, 1999. "Semiparametric Estimation of a Proportional Hazard Model with Unobserved Heterogeneity," Econometrica, Econometric Society, vol. 67(5), pages 1001-1028, September.
- Elaine Silverman & Jonathan Skinner, 2001. "Are For-Profit Hospitals Really Different? Medicare Upcoding and Market Structure," NBER Working Papers 8133, National Bureau of Economic Research, Inc.
- Mark McClellan & Douglas Staiger, 1999. "The Quality of Health Care Providers," NBER Working Papers 7327, National Bureau of Economic Research, Inc.
- Gowrisankaran, Gautam & Town, Robert J., 1999. "Estimating the quality of care in hospitals using instrumental variables," Journal of Health Economics, Elsevier, vol. 18(6), pages 747-767, December.
- Pauly, Mark V & Redisch, Michael, 1973. "The Not-For-Profit Hospital as a Physicians' Cooperative," American Economic Review, American Economic Association, vol. 63(1), pages 87-99, March.
- Ho, Vivian & Hamilton, Barton H., 2000. "Hospital mergers and acquisitions: does market consolidation harm patients?," Journal of Health Economics, Elsevier, vol. 19(5), pages 767-791, September.
- Mark McClellan & Douglas Staiger, 2000.
"Comparing the Quality of Health Care Providers,"
in: Frontiers in Health Policy Research, Volume 3, pages 113-136
National Bureau of Economic Research, Inc.
- Propper, Carol & Burgess, Simon & Green, Katherine, 2004. "Does competition between hospitals improve the quality of care?: Hospital death rates and the NHS internal market," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1247-1272, July.
When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:14:y:2005:i:11:p:1151-1168. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.