University of Hamburg Reports Findings in Healthcare Economics (What drives different treatment choices? Investigation of hospital ownership, system membership and competition)

2021 FEB 26 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- New research on Economics - Healthcare Economics is the subject of a report. According to news reporting from Hamburg, Germany, by NewsRx journalists, research stated, “Differences in ownership types have attracted considerable interest because of policy implications. Moreover, competition in hospital markets is promoted to reduce health care spending.”

The news correspondents obtained a quote from the research from the University of Hamburg, “However, the effects of system membership and competition on treatment choices of hospitals have not been considered in studying hospital ownership types. We examine the treatment choices of hospitals considering ownership types (not-for-profit, for-profit, and government), system membership, patient insurance status (insured, and uninsured) and hospital competition in the United States. We estimate the probability of according the procedure as the treatment employing logistic regression. We consider all procedures accorded at hospitals, controlling for procedure type and diagnosis as well as relevant patient and hospital characteristics. Competition faced by hospitals is measured using a distance-weighted approach separately for procedural groups. Patient records are obtained from State Inpatient Databases for 11 states and hospital characteristics come from American Hospital Association Annual Survey. Not-for-profit hospitals facing low for-profit competition that are nonmembers of hospital systems, act like government hospitals, whereas not-for-profits facing high for-profit competition and system member not-for-profits facing low for-profit competition are not statistically significantly different from their for-profit counterparts in terms of treatment choices. Uninsured patients are on average 7% less likely to be accorded the procedure as the treatment at system member not-for-profit hospitals facing high for-profit competition than insured patients. System member not-for-profit hospitals, which account for over half of the observations in the analysis, are on average 16% more likely to accord the procedure as the treatment when facing high for-profit competition than low-for-profit competition. We show that treatment choices of hospitals differ by system membership and the level of for-profit competition faced by the hospitals in addition to hospital ownership type and health insurance status of patients. Our results support that hospital system member not-for-profits and not-for-profits facing high for-profit competition are for-profits in disguise. Therefore, system membership is an important characteristic to consider in addition to market competitiveness when tax exemption of not-for-profits are revisited.”

According to the news reporters, the research concluded: “Moreover, higher competition may lead to increasing health care costs due to more aggressive treatment choices, which should be taken into account while regulating hospital markets.”

For more information on this research see: What drives different treatment choices? Investigation of hospital ownership, system membership and competition. Health Economics Review, 2021;11(1):6. Health Economics Review can be contacted at: Springer (Biomed Central Ltd.), Campus, 4 Crinan St, London N1 9XW, England. (Springer - www.springer.com; Health Economics Review - http://www.springerlink.com/content/2191-1991/)

Our news journalists report that additional information may be obtained by contacting Esra Eren Bayindir, Hamburg Center for Health Economics, University of Hamburg, Hamburg, Germany.

Publisher contact information for the journal Health Economics Review is: Springer (Biomed Central Ltd.), Campus, 4 Crinan St, London N1 9XW, England.

(Our reports deliver fact-based news of research and discoveries from around the world.)