Hospital behavior under competition and cost-containment policies. The California experience, 1980 to 1985
G. A. Melnick and J. Zwanziger
UCLA School of Public Health 90024.
Previous studies of hospital competition have found that greater
competition leads to higher hospital costs. We describe herein the change
in behavior of California's hospitals since the introduction of competitive
and cost-containment programs. To examine the impact of California's
pro-competition policies on hospital performance, we grouped the state's
short-term hospitals according to the level of competition within their
markets. From 1983 through 1985, total inpatient costs (inflation adjusted)
increased by less than 1% in hospitals in low-competition markets compared
with a decrease of 11.29% in hospitals located in highly competitive
markets. After controlling for the effects of the Medicare prospective
payment system program, the rate of increase in cost per discharge in
hospitals in highly competitive markets was 3.53% lower than the rate of
increase in hospitals in low-competition markets during the period from
1983 through 1985. We conclude that these pro-competition policies are
having dramatic and potentially far-reaching effects on the nature of
hospital competition, leading to increased competition based on price.
Quality Competition Among Hospitals: The Effects of Perceived Quality and Perceived Expensiveness on Health Care Consumers
Cheng et al.
American Journal of Medical Quality 2006;21:68-75.
ABSTRACT
Community Control and Pricing Patterns of Nonprofit Hospitals: An Antitrust Analysis
Young et al.
Journal of Health Politics, Policy and Law 2000;25:1051-1081.
ABSTRACT
Selection of a cardiac surgery provider in the managed care era
Shahian et al.
J. Thorac. Cardiovasc. Surg. 2000;120:978-989.
ABSTRACT
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Distribution of Variable vs Fixed Costs of Hospital Care
Roberts et al.
JAMA 1999;281:644-649.
ABSTRACT
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Managed Care, Medical Technology, and Health Care Cost Growth: A Review of the Evidence
Chernew et al.
Med Care Res Rev 1998;55:259-288.
ABSTRACT
Federal Antitrust Merger Enforcement Standards: A Good Fit for the Hospital Industry?
Bazzoli et al.
Journal of Health Politics, Policy and Law 1995;20:137-169.
ABSTRACT
Hospitals and Antitrust: Defining Markets, Setting Standards
Zwanziger et al.
Journal of Health Politics, Policy and Law 1994;19:423-447.
ABSTRACT
Spatial Competition and Cooperation in Local Hospital Markets
Luke
Med Care Res Rev 1991;48:207-237.
COST-CONTAINMENT PROGRAMS THAT EMPHASIZE COMPETITION APPEAR EFFECTIVE
JWatch General 1988;1988:6-6.
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