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The Impact of Organizational Boundaries on Healthcare Coordination and Utilization

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  • Leila Agha
  • Keith Marzilli Ericson
  • Xiaoxi Zhao

Abstract

We measure organizational concentration—the distribution of a patient's healthcare across organizations—to examine how firm boundaries affect healthcare efficiency. First, when patients move to regions where outpatient visits are typically concentrated within a small set of firms, their healthcare utilization falls. Second, for patients whose PCPs exit the market, switching to a PCP with 1 standard deviation higher organizational concentration reduces utilization by 21%. This finding is robust to controlling for the spread of healthcare across providers. Increases in organizational concentration predict improvements in diabetes care and are not associated with greater use of emergency department or inpatient care.

Suggested Citation

  • Leila Agha & Keith Marzilli Ericson & Xiaoxi Zhao, 2020. "The Impact of Organizational Boundaries on Healthcare Coordination and Utilization," NBER Working Papers 28179, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:28179
    Note: AG CF HC HE IO LE LS PE
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    More about this item

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

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