Melbourne Institute of Applied Economic and Social Research - Research Publications
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ItemNo Preview AvailableNursing Home Competition, Prices, and Quality: A Scoping Review and Policy Lessons(OXFORD UNIV PRESS INC, 2022-08-12)BACKGROUND AND OBJECTIVES: In recent years, countries have increasingly relied on markets to improve efficiency, contain costs, and maintain quality in aged care. Under the right conditions, competition can spur providers to compete by offering better prices and higher quality of services. However, in aged care, market failures can be extensive. Information about prices and quality may not be readily available and search costs can be high. This study undertakes a scoping review on competition in the nursing home sector, with an emphasis on empirical evidence in relation to how competition affects prices and quality of care. RESEARCH DESIGN AND METHODS: Online databases were used to identify studies published in the English language between 1988 and 2020. A total of 50 studies covering 9 countries are reviewed. RESULTS: The review finds conflicting evidence on the relationship between competition and quality. Some studies find greater competition leading to higher quality, others find the opposite. Institutional features such as the presence of binding supply restrictions on nursing homes and public reporting of quality information are important considerations. Most studies find greater competition tends to result in lower prices, although the effect is small. DISCUSSION AND IMPLICATIONS: The literature offers several key policy lessons, including the relationship between supply restrictions and quality, which has implications on whether increasing subsidies can result in higher quality and the importance of price transparency and public reporting of quality.
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ItemAn Examination of Public Hospital Productivity and its Persistence: An Index Number Approach(Wiley, 2020-09-01)This paper measures the level and growth of total factor productivity (TFP) of public hospitals in Victoria, Australia, using an index number approach. We further examine the persistence of productivity over time, and the extent to which productivity varies with hospital characteristics such as hospital size. Hospital administrative data from Victoria from 2007–08 to 2011–12 are used. We find substantial variation in TFP across hospitals: large hospitals perform significantly better than small hospitals, both in TFP level and growth. Productivity level is highly persistent over time, but not productivity growth.
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ItemFinancial Incentives to Encourage Value-Based Health Care(SAGE PUBLICATIONS INC, 2018-02)This article reviews the literature on the use of financial incentives to improve the provision of value-based health care. Eighty studies of 44 schemes from 10 countries were reviewed. The proportion of positive and statistically significant outcomes was close to .5. Stronger study designs were associated with a lower proportion of positive effects. There were no differences between studies conducted in the United States compared with other countries; between schemes that targeted hospitals or primary care; or between schemes combining pay for performance with rewards for reducing costs, relative to pay for performance schemes alone. Paying for performance improvement is less likely to be effective. Allowing payments to be used for specific purposes, such as quality improvement, had a higher likelihood of a positive effect, compared with using funding for physician income. Finally, the size of incentive payments relative to revenue was not associated with the proportion of positive outcomes.
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ItemCompetition, prices and quality in the market for physician consultations(Wiley, 2016-04)Prices for consultations with General Practitioners (GP's) in Australia are unregulated, and patients pay the difference between the price set by the GP and a fixed reimbursement from the national tax-funded Medicare insurance scheme. We construct a Vickrey-Salop model of GP price and quality competition and test its predictions using individual GP-level data on prices, the proportion of patients who are charged no out-of-pocket fee, average consultation length, and characteristics of the GP's, their practices and their local areas. We measure the competition to which the GP is exposed by the distance to other GP practices and allow for the endogeneity of GP location decisions with measures of area characteristics and area fixed-effects. Within areas, GP's with more distant competitors charge higher prices and a smaller proportion of their patients make no out-of-pocket payment. GP's with more distant competitors also have shorter consultations, though the effect is small and statistically insignificant.