Date of this Version
Hosted by University of California Berkeley, Economics Department
Physician ownership of hospitals involves several competing economic forces. Physician-owners may be incentivized to "cherry-pick" and treat profitable patients at their facilities. However, physician-owned hospitals are often specialized and may provide higher-quality care. This paper uses a structural choice-outcome model to estimate hospital quality, patient-hospital matching, and preferences for treating patients at owned vs. competing hospitals. Instrumental variables analysis of cardiac mortality is used to capture quality; I document a significant mortality improvement at physician-owner preferences; controlling for matching and baseline patient preferences, there is little evidence of physician-owner cherry-picking.
Swanson, A. (2013). Physician Investment in Hospitals: Specialization, Incentives, and the Quality of Cardiac Care. Hosted by University of California Berkeley, Economics Department, Retrieved from https://repository.upenn.edu/hcmg_papers/9
Date Posted: 27 November 2017