IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Prices and Quantities in Health Care Antitrust Damages

Author Info

Listed author(s):
  • Martha A. Starr
  • R. Forrest McCluer

Abstract

Antitrust analysis conventionally assumes that illegal agreements among competitors raise prices and lower quantities, relative to lawful competition. However, markets for healthcare services have tendencies towards overprovision, which may increase when competition declines. This paper examines this possibility using data from a well-known antitrust case in Wisconsin. We find that, in parts of the state where physician groups illegally divided up markets, costs of physician services rose by about 10% more than they did elsewhere, with about half of this increase due to increased services. This suggests that higher quantities can contribute to healthcare antitrust damages, along with higher prices.

Download Info

If 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.

File URL: http://www.american.edu/cas/economics/research/upload/2014-03.pdf
File Function: First version, 2014
Download Restriction: no

Paper provided by American University, Department of Economics in its series Working Papers with number 2014-03.

as
in new window

Length:
Date of creation: 2014
Handle: RePEc:amu:wpaper:2014-03
Contact details of provider: Web page: http://www.american.edu/cas/economics/

Keywords:

This paper has been announced in the following NEP Reports:

References listed on IDEAS
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.:

as
in new window


  1. Ching-To Albert Ma & Thomas G. Mcguire, 2002. "Network Incentives in Managed Health Care," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 11(1), pages 1-35, 03.
  2. Capps, Cory & Dranove, David & Satterthwaite, Mark, 2003. " Competition and Market Power in Option Demand Markets," RAND Journal of Economics, The RAND Corporation, vol. 34(4), pages 737-763, Winter.
  3. Martin Gaynor, "undated". "What Do We Know About Competition and Quality in Health Care Markets?," GSIA Working Papers 2006-E62, Carnegie Mellon University, Tepper School of Business.
  4. Christopher J. Ruhm, 2000. "Are Recessions Good for Your Health?," The Quarterly Journal of Economics, Oxford University Press, vol. 115(2), pages 617-650.
  5. Gaynor, Martin & Vogt, William B., 2000. "Antitrust and competition in health care markets," Handbook of Health Economics,in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 27, pages 1405-1487 Elsevier.
  6. Laurence C. Baker & Kenneth S. Corts, 1995. "The Effects of HMOs on Conventional Insurance Premiums: Theory and Evidence," NBER Working Papers 5356, National Bureau of Economic Research, Inc.
  7. Laurence C. Baker, 1994. "Does Competition from HMOs Affect Fee-For-Service Physicians?," NBER Working Papers 4920, National Bureau of Economic Research, Inc.
  8. R. Forrest McCluer & Martha A. Starr, 2013. "Using Difference in Differences to Estimate Damages in Healthcare Antitrust: A Case Study of Marshfield Clinic," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 20(3), pages 447-469, November.
  9. Marie Allard & Pierre Thomas Léger & Lise Rochaix, 2009. "Provider Competition in a Dynamic Setting," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(2), pages 457-486, 06.
  10. Lynk, William J, 1995. "Nonprofit Hospital Mergers and the Exercise of Market Power," Journal of Law and Economics, University of Chicago Press, vol. 38(2), pages 437-461, October.
  11. Alberto Abadie, 2005. "Semiparametric Difference-in-Differences Estimators," Review of Economic Studies, Oxford University Press, vol. 72(1), pages 1-19.
  12. Pauly, Mark V, 1986. "Taxation, Health Insurance, and Market Failure in the Medical Economy," Journal of Economic Literature, American Economic Association, vol. 24(2), pages 629-675, June.
  13. Feldstein, Martin S, 1973. "The Welfare Loss of Excess Health Insurance," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 251-280, Part I, M.
  14. Daniel L. Rubinfeld, 2010. "Econometric Issues in Antitrust Analysis," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 166(1), pages 62-77, March.
  15. John Schneider & Pengxiang Li & Donald Klepser & N. Peterson & Timothy Brown & Richard Scheffler, 2008. "The effect of physician and health plan market concentration on prices in commercial health insurance markets," International Journal of Health Economics and Management, Springer, vol. 8(1), pages 13-26, March.
  16. Aizcorbe, Ana & Nestoriak, Nicole, 2011. "Changing mix of medical care services: Stylized facts and implications for price indexes," Journal of Health Economics, Elsevier, vol. 30(3), pages 568-574, May.
Full references (including those not matched with items on IDEAS)

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

as
in new window


Cited by:

  1. R. Forrest McCluer & Martha A. Starr, 2013. "Using Difference in Differences to Estimate Damages in Healthcare Antitrust: A Case Study of Marshfield Clinic," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 20(3), pages 447-469, November.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Access and download statistics

When requesting a correction, please mention this item's handle: RePEc:amu:wpaper:2014-03. 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: (Thomas Meal)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.