Does Hospital Competition Improve Efficiency? An Analysis of the Recent Market-Based Reforms to the English NHS
This paper uses a difference-in-difference estimator to test whether the introduction of patient choice and hospital competition in the English NHS in January 2006 has prompted hospitals to become more efficient. Efficiency was measured using hospitals' average length of stay (LOS) for patients undergoing elective hip replacement. LOS was broken down into its two key components: the time from a patient's admission until their surgery and the time from their surgery until their discharge. Our results illustrate that hospitals exposed to competition after a wave of market-based reforms took steps to shorten the time patients were in the hospital prior to their surgery, which resulted in a decrease in overall LOS. We find that hospitals shortened patients' LOS without compromising patient outcomes or by operating on healthier, wealthier or younger patients. Our results suggest that hospital competition within markets with fixed prices can increase hospital efficiency.
|Date of creation:||Jun 2010|
|Date of revision:|
|Contact details of provider:|| Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP |
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.:
- Zack Cooper & Stephen Gibbons & Simon Jones & Alistair McGuire, 2011.
"Does Hospital Competition Save Lives? Evidence From The English NHS Patient Choice Reforms,"
Royal Economic Society, vol. 121(554), pages F228-F260, 08.
- Zack Cooper & Steve Gibbons & Simon Jones & Alistair McGuire, 2010. "Does Hospital Competition Save Lives? Evidence from the English NHS Patient Choice Reforms," SERC Discussion Papers 0041, Spatial Economics Research Centre, LSE.
- Zack Cooper & Stephen Gibbons & Simon Jones & Alistair McGuire, 2010. "Does hospital competition save lives?: evidence from the English NHS patient choice reforms," LSE Research Online Documents on Economics 28584, London School of Economics and Political Science, LSE Library.
- Chalkley, Martin & Malcomson, James M, 1998.
"Contracting for Health Services with Unmonitored Quality,"
Royal Economic Society, vol. 108(449), pages 1093-1110, July.
- Chalkley, M. & Malcomson, J.M., 1995. "Contracting for health services with unmonitored quality," Discussion Paper Series In Economics And Econometrics 9510, Economics Division, School of Social Sciences, University of Southampton.
- Hunter, David J., 2009. "The case against choice and competition," Health Economics, Policy and Law, Cambridge University Press, vol. 4(04), pages 489-501, October.
- Martin, Stephen & Smith, Peter, 1996. "Explaining variations in inpatient length of stay in the National Health Service," Journal of Health Economics, Elsevier, vol. 15(3), pages 279-304, June.
- Dixon, Jennifer, 2009. "Invisible hand? More like post-modern mush," Health Economics, Policy and Law, Cambridge University Press, vol. 4(04), pages 503-508, October.
- Fenn, Paul & Davies, Philip, 1990. "Variations in length of stay : A conditional likelihood approach," Journal of Health Economics, Elsevier, vol. 9(2), pages 223-234, September.
- Daniel P. Kessler & Mark B. McClellan, 2000. "Is Hospital Competition Socially Wasteful?," The Quarterly Journal of Economics, MIT Press, vol. 115(2), pages 577-615, May.
- Burgess, Simon & Gossage, Denise & Propper, Carol, 2003.
"Competition and Quality: Evidence from the NHS Internal Market 1991-9,"
CEPR Discussion Papers
4026, C.E.P.R. Discussion Papers.
- Carol Propper & Simon Burgess & Denise Gossage, 2008. "Competition and Quality: Evidence from the NHS Internal Market 1991-9," Economic Journal, Royal Economic Society, vol. 118(525), pages 138-170, 01.
- Carol Propper & Deborah Wilson & Simon Burgess, 2005.
"Extending Choice In English Health Care: The implications of the economic evidence,"
The Centre for Market and Public Organisation
05/133, Department of Economics, University of Bristol, UK.
- Burgess, Simon & Propper, Carol & Wilson, Deborah, 2005. "Extending Choice In English Health Care: The implications of the economic evidence," CEPR Discussion Papers 5328, C.E.P.R. Discussion Papers.
- Street, Andrew & Maynard, Alan, 2007. "Activity based financing in England: the need for continual refinement of payment by results," Health Economics, Policy and Law, Cambridge University Press, vol. 2(04), pages 419-427, October.
- Le Grand, Julian, 2009. "Choice and competition in publicly funded health care," Health Economics, Policy and Law, Cambridge University Press, vol. 4(04), pages 479-488, October.
When requesting a correction, please mention this item's handle: RePEc:cep:cepdps:dp0988. 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: ()
If references are entirely missing, you can add them using this form.