Strategic integration of hospitals and physicians

Cuellar, Alison Evans; Gertler, Paul

doi:10.1016/j.jhealeco.2005.04.009

Cited by 147 publications

(219 citation statements)

References 23 publications

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“…[30][31][32] Second, the demographic data for each hospital group had missing values due to the fact that this statistic was selfreported. As a result, it is possible that gender and race proportions may have varied more than expected.…”

Section: Discussionmentioning

confidence: 99%

Low-mortality death in hospitals after vertical integration with Health Maintenance Organizations

Miller

Hodgson

2017

JHA

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Objective: Hospital mergers and acquisitions continue to rise due to government and market pressures to join Accountable Care Organizations in order to lower costs. Our study examines the changes in a quality of care measure when hospitals were acquired by Health Maintenance Organizations (HMOs) to analyze the effect that vertical integration has on coordination of care. Methods: Using California patient discharge data from 2000-2011, our analysis used differences-in-differences and logistic models to test for a change in a quality of care measure before and after hospitals merged with an HMO. We utilized Patient Safety Indicator #2, death rate in low-mortality diagnosis related groups, to measure quality of care. Results: Hospitals experienced decreases in low-mortality death rates after being acquired by an HMO. This group of hospitals had increasing measures of the quality indicator prior to the merge as well, suggesting selection of well-performing hospitals by HMOs. Hospitals acquired by HMOs also faced increased Type-2 diabetes rates post-merge. Conclusions: Our results suggest that hospitals merging with a vertically integrated health care system may lead to increases in quality of care. It appears that this could be due to either HMOs providing more coordinated care, or that HMOs acquire hospitals already trending towards better care.

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Section: Discussionmentioning

confidence: 99%

Low-mortality death in hospitals after vertical integration with Health Maintenance Organizations

Miller

Hodgson

2017

JHA

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“…Of many physician-hospital arrangements that vary with the structure and process of physician-hospital integration 19 including physician hospital organizations, management service organizations, and foundation models, in the interest of tractability only 2 extreme versions of integration, independent practice associations (the least integrated case, private practice) and the integrated salary model (the fully integrated case, the employed model), were chosen for the present study. 20 Second, the investigator limited the informant groups to the field of surgery to avoid other biases. Results might have differed had the informant groups been, for example, primary care physicians.…”

Section: Discussionmentioning

confidence: 99%

The Costs of Physician-Hospital Integration

Cho

2014

AMPROC

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Given that the enactment of the Patient Protection and Affordable Care Act of 2010 is expected to generate forces toward physician-hospital integration, this study examined an understudied, albeit important, area of costs incurred in physician-hospital integration. Such costs were analyzed through 24 semi-structured interviews with physicians and hospital administrators in a multiple-case, inductive study. Two extreme types of physician-hospital arrangements were examined: an employed model (ie, integrated salary model, a group of physicians integrated by a hospital system) and a private practice (ie, a physician or group of physicians who are independent of economic or policy control). Interviews noted that integration leads to 3 evident costs, namely, monitoring, coordination, and cooperation costs. Improving our understanding of the kinds of costs that are incurred after physician-hospital integration will help hospitals and physicians to avoid common failures after integration.(Medicine 94(42):e1762)

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“…The debate has one side claiming that lower costs associated with managed care are the outcome of quality degradation, while the other side claims that lower costs are due to the ability of managed care organizations to obtain lower prices from providers. The existing evidence favours the latter interpretation over the former (see, among others, Cuellar and Gertler, 2006;Cutler et al, 2000;Ho, 2004;Maude-Griffin et al, 2001, Melnick et al, 1992Sieg (2000)). …”

Section: Evidence On Bargaining Outcomesmentioning

confidence: 92%

Models of Negotiation and Bargaining in Health Care

Barros¹,

Martínez-Giralt²

2012

The Elgar Companion to Health Economics, Second Edition

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IntroductionUnder traditional health insurance arrangements, citizens were covered by some insurance scheme. When sick, insurance arrangements allowed citizens to go to a health care provider, pay the price of the care received and be reimbursed later. Alternatively, the care provider would be owned by the insurer (like in integrated national health systems) and the patient paid nothing at the moment of consumption. In such arrangements, providers would freely set their prices or have no price to set at all (in an NHS-like system).Recent developments in health care financing include independent institutions that negotiate the prices with the financing institution. This is true with respect to health maintenance organizations (HMOs), managed care in general, but also in national health systems where decentralization and the split between provision and financing is implemented.In this scenario, negotiation over contractual terms, including prices as one major element, becomes a relevant issue in the analysis of performance of health care systems. Both empirical and theoretical analyses have been produced, and are reviewed below.This chapter reflects our views and preferences. It does not aim to be an encyclopaedic view of the existing literature on bargaining in health care. Instead, we try to highlight the new developments associated with explicit bargaining between third-party payers and providers of health care (a relation which is, in itself, only one of many that exist in the health care sector).Bargaining theory has a long tradition in the economics literature. However, it is only recently that this approach has found space in the analysis of the health care sector. The recognition of the strategic interaction among agents in the health care sector (patients, providers and third-party payers) came with the application of models borrowed from the industrial organization tradition dating from the 1970s. It was in the early 1990s when a step forward was taken with the eruption of the models of bargaining (see for example, Osborne and Rubinstein, 1990, for a nice presentation) In many situations the health care sector has the structure of a bilateral monopoly/oligopoly. In this context, bargaining becomes the natural way to approach the interactions among agents.Most economic analyses of contract design in health care in fact assume that the party that moves first, typically the payer, proposes a take-it-or-leave-it offer to the provider. We take here a broader view, looking at other types of negotiation procedures. We do not discuss issues related to contract design, which are taken up in chapter 22 by Chalkley in this Companion.We focus here on models of explicit bargaining between two parties, which we call the payer and the provider. On theoretical grounds, simple bargaining models can have their results transposed in a straightforward way: higher bargaining power and higher

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Strategic integration of hospitals and physicians

Cited by 147 publications

References 23 publications

Low-mortality death in hospitals after vertical integration with Health Maintenance Organizations

Low-mortality death in hospitals after vertical integration with Health Maintenance Organizations

The Costs of Physician-Hospital Integration

Models of Negotiation and Bargaining in Health Care

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