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Inter-regional competition and quality in hospital care

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  • Hiroshi Aiura

Abstract

This study analyzes the effect of episode-of-care payment and patient choice on waiting time and the comprehensive quality of hospital care. The study assumes that two hospitals are located in two cities with different population sizes and compete with each other. We find that the comprehensive quality of hospital care as well as waiting time of both hospitals improve with an increase in payment per episode of care. However, we also find that the extent of these improvements differs according to the population size of the cities where the hospitals are located. Under the realistic assumptions that hospitals involve significant labor-intensive work, we find the improvements in comprehensive quality and waiting time in a hospital located in a small city to be greater than those in a hospital located in a large city. The result implies that regional disparity in the quality of hospital care decreases with an increase in payment per episode of care. Copyright Springer-Verlag 2013

Suggested Citation

  • Hiroshi Aiura, 2013. "Inter-regional competition and quality in hospital care," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(3), pages 515-526, June.
    • Handle: RePEc:spr:eujhec:v:14:y:2013:i:3:p:515-526
    DOI: 10.1007/s10198-012-0396-5
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    Cited by:

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    3. Francisco Martínez-Sánchez, 2022. "Privatization Policies by National and Regional Governments," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 24(02), pages 1-23, June.

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    More about this item

    Keywords

    Patient choice; Waiting time; Hotelling-type spatial competition model; Multi-region model; I18; L32;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises

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