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Explaining trends in concentration of healthcare commissioning in the English NHS

  • Mark Dusheiko

    (National Primary Care Research and Development Centre, Centre for Health Economics, University of York, York, UK)

  • Maria Goddard

    (Centre for Health Economics, University of York, York, UK)

  • Hugh Gravelle

    (National Primary Care Research and Development Centre, Centre for Health Economics, University of York, York, UK)

  • Rowena Jacobs

    (Centre for Health Economics, University of York, York, UK)

In recent years there have been marked changes in organisational structures and budgetary arrangements in the English National Health Service, potentially altering the relationships between purchasers (primary care organisations (PCOs) and general practices) and hospitals. We show that elective admissions from PCOs and practices became significantly more concentrated across hospitals between 1997|98 and 2002|03. There was a reduction in the average number of hospitals used by PCOs (16.7-14.2), an increase in the average share of admissions accounted for by the main hospital (49-69%), and an increase in the average Herfindahl index (0.35-0.55). About half the increase in concentration arose from the increase in the number of purchasing organisations as 100 health authorities were replaced by 303 primary care trusts. Most of the remainder was probably due to hospital mergers. Fundholding general practices that held budgets for elective admissions had less concentrated admission patterns than non-fundholders whose admissions were paid for by their PCO. Around 1|10th of the increase in concentration at practice level was due to the abolition of fundholding in April 1999. Our results have implications for the effects of the recent reintroduction of fundholding and the halving of the number of PCOs. Copyright © 2007 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.1301
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Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 17 (2008)
Issue (Month): 8 ()
Pages: 907-926

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Handle: RePEc:wly:hlthec:v:17:y:2008:i:8:p:907-926
Contact details of provider: Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Martin Gaynor, 2006. "What Do We Know About Competition and Quality in Health Care Markets?," NBER Working Papers 12301, National Bureau of Economic Research, Inc.
  2. Propper, Carol, 1996. "Market structure and prices: The responses of hospitals in the UK National Health Service to competition," Journal of Public Economics, Elsevier, vol. 61(3), pages 307-335, September.
  3. Gravelle, Hugh & Dusheiko, Mark & Sutton, Matthew, 2002. "The demand for elective surgery in a public system: time and money prices in the UK National Health Service," Journal of Health Economics, Elsevier, vol. 21(3), pages 423-449, May.
  4. Martin, Stephen & Smith, Peter C., 1999. "Rationing by waiting lists: an empirical investigation," Journal of Public Economics, Elsevier, vol. 71(1), pages 141-164, January.
  5. Propper, Carol & Croxson, Bronwyn & Shearer, Arran, 2002. "Waiting times for hospital admissions: the impact of GP fundholding," Journal of Health Economics, Elsevier, vol. 21(2), pages 227-252, March.
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  7. Dranove, David & Lindrooth, Richard, 2003. "Hospital consolidation and costs: another look at the evidence," Journal of Health Economics, Elsevier, vol. 22(6), pages 983-997, November.
  8. Mark Dusheiko & Hugh Gravelle & Rowena Jacobs, 2004. "The effect of practice budgets on patient waiting times: allowing for selection bias," Health Economics, John Wiley & Sons, Ltd., vol. 13(10), pages 941-958.
  9. Fotaki, Marianna, 1999. "The impact of market oriented reforms on choice and information: a case study of cataract surgery in outer London and Stockholm," Social Science & Medicine, Elsevier, vol. 48(10), pages 1415-1432, May.
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  11. Maria Goddard & Russell Mannion & Brian Ferguson, 1997. "Contracting in the UK NHS: purpose, process and policy," Working Papers 156chedp, Centre for Health Economics, University of York.
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