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Hospital Treatment Rates and Spill-Over Effects: Does Ownership Matter?

January 1, 2014

This paper studies the effect of hospital ownership on treatment rates allowing for spatial correlation among hospitals. Competition among hospitals and knowledge spillovers generate significant externalities which we try to capture using the spatial Durbin model. Using a panel of 2342 hospitals in the 48 continental states observed over the period 2005 to 2008, we find significant spatial correlation of medical service treatment rates among hospitals. The paper also shows mixed results on the effect of hospital ownership on treatment rates that depends upon the market structure where the hospital is located and which varies by treatment type.

Medical Technology and the Production of Health Care

March 1, 2011

This paper investigates the factors that determine differences across OECD countries inhealth outcomes, using data on life expectancy at age 65, over the period 1960 to 2007. We estimate a production function where life expectancy depends on health and social spending, lifestyle variables, and medical innovation. Our first set of regressions includes a set of observed medical technologies by country. Our second set of regressions proxy technology using a spatial process. The paper also tests whether in the long-run countries tend to achieve similar levels of health outcomes. Our results show that health spending has a significant and mild effect on health out- comes, even after controlling for medical innovation. However, its short-run adjustments do not seem to have an impact on health care productivity. Spatial spill overs in life expectancy are significant and point to the existence of interdependence across countries in technology adoption. Furthermore, nations with initial low levels of life expectancy tend to catch up with those with longer-lived populations.