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Hospital Ownership, Reimbursement Systems and Mortality Rates

Author

Listed:
  • Carine Milcent

    (PJSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, IEMS - Institut d'économie et de management de la santé - UNIL - Université de Lausanne = University of Lausanne)

Abstract
This paper analyses the effect of ownership and system of reimbursement on mortality rates. From the statistical results we could conclude that the incentive created by fee-for-service reimbursement yields a four-point reduction in the mortality rate. However, this ranking of hospital quality is completely dependent on the characteristics and illness severity of patients. To take this difficulty into account, we use an innovative duration model applied to panel data: a duration model with both patient and hospital unobserved heterogeneity. No distributional assumptions are made regarding the latter. By this way, we control the fact that patients admitted to the private sector can be different in terms of disease severity from patients admitted to the public sector. The capacity to perform innovative procedures has more effect on the mortality than the system of reimbursement and/or ownership. As such, private sector hospitals that perform more innovative procedures provide a better quality of care, measured by the probability of dying. Nevertheless, heterogeneity within hospitals is greater in for-profit hospitals than in other types of hospital. This suggests that, by choosing a for-profit hospital, patients have on average a lower instantaneous probability of dying but are less sure about the quality of the hospital.

Suggested Citation

  • Carine Milcent, 2005. "Hospital Ownership, Reimbursement Systems and Mortality Rates," Post-Print halshs-00754053, HAL.
    • Handle: RePEc:hal:journl:halshs-00754053
    DOI: 10.1002/hec.1010
    Note: View the original document on HAL open archive server: https://pjse.hal.science/halshs-00754053
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    References listed on IDEAS

    as
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    Citations

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    Cited by:

    1. Laurent Gobillon & Carine Milcent, 2013. "Spatial disparities in hospital performance," Journal of Economic Geography, Oxford University Press, vol. 13(6), pages 1013-1040, November.
    2. Hentschker, Corinna & Mennicken, Roman, 2012. "The Relationship between Quality and Hospital Case Volume – An Empirical Examination with German Data," Ruhr Economic Papers 341, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    3. Moscone, Francesco & Siciliani, Luigi & Tosetti, Elisa & Vittadini, Giorgio, 2020. "Do public and private hospitals differ in quality? Evidence from Italy," Regional Science and Urban Economics, Elsevier, vol. 83(C).
    4. Hentschker, Corinna & Mennicken, Roman, 2014. "Selective-referral and unobserved patient heterogeneity - Bias in the volume-outcome relationship," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100299, Verein für Socialpolitik / German Economic Association.
    5. Corinna Hentschker & Roman Mennicken & Antonius Reifferscheid & Jürgen Wasem & Ansgar Wübker, 2018. "Volume-outcome relationship and minimum volume regulations in the German hospital sector – evidence from nationwide administrative hospital data for the years 2005–2007," Health Economics Review, Springer, vol. 8(1), pages 1-14, December.
    6. Kurt R. Brekke & Luigi Siciliani & Odd Rune Straume, 2011. "Quality competition with profit constraints: Do non-profit firms provide higher quality than for-profit firms?," NIPE Working Papers 05/2011, NIPE - Universidade do Minho.
    7. Paul H. Jensen & Elizabeth Webster & Julia Witt, 2009. "Hospital type and patient outcomes: an empirical examination using AMI readmission and mortality records," Health Economics, John Wiley & Sons, Ltd., vol. 18(12), pages 1440-1460, December.
    8. Martine Bellanger & Laurent Tardif, 2006. "Accounting and reimbursement schemes for inpatient care in France," Health Care Management Science, Springer, vol. 9(3), pages 295-305, August.
    9. repec:zbw:rwirep:0527 is not listed on IDEAS
    10. Corinna Hentschker & Roman Mennicken, 2014. "Selective-referral and Unobserved Patient Heterogeneity – Bias in the Volume-outcome Relationship," Ruhr Economic Papers 0527, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    11. Laurent Gobillon & Carine Milcent, 2008. "Regional disparities in mortality by heart attack: evidence from France," Working Papers halshs-00586837, HAL.
    12. Corinna Hentschker & Roman Mennicken, 2015. "The Volume‐Outcome Relationship and Minimum Volume Standards – Empirical Evidence for Germany," Health Economics, John Wiley & Sons, Ltd., vol. 24(6), pages 644-658, June.
    13. Mareike Heimeshoff & Jonas Schreyögg & Oliver Tiemann, 2014. "Employment effects of hospital privatization in Germany," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 15(7), pages 747-757, September.
    14. repec:dau:papers:123456789/7738 is not listed on IDEAS
    15. Corinna Hentschker & Roman Mennicken, 2012. "The Relationship between Quality and Hospital Case Volume – An Empirical Examination with German Data," Ruhr Economic Papers 0341, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    16. repec:hal:pseose:halshs-00879787 is not listed on IDEAS
    17. Brigitte Dormont & Carine Milcent, 2012. "Comment évaluer la productivité et l'efficacité des hôpitaux publics et privés ? Les enjeux de la convergence tarifaire," Économie et Statistique, Programme National Persée, vol. 455(1), pages 143-173.
    18. Luigi Siciliani & Peter Sivey & Andrew Street, 2011. "Differences in Length of Stay between Public Hospitals, Treatment Centres and Private Providers: Selection or Efficiency?," Melbourne Institute Working Paper Series wp2011n06, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    19. Moscelli, Giuseppe & Gravelle, Hugh & Siciliani, Luigi & Gutacker, Nils, 2018. "The effect of hospital ownership on quality of care: Evidence from England," Journal of Economic Behavior & Organization, Elsevier, vol. 153(C), pages 322-344.
    20. Brekke, Kurt R. & Siciliani, Luigi & Straume, Odd Rune, 2012. "Quality competition with profit constraints," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 642-659.
    21. Milcent, Carine, 2023. "The sorting effect in healthcare access: Those left behind," Economics & Human Biology, Elsevier, vol. 51(C).
    22. repec:zbw:rwirep:0341 is not listed on IDEAS

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