Supply-induced demand for hospital care

Area of Science:

• Health Services Research
• Healthcare Management
• Rural Health Policy

Background:

• Roemer's Law posits a direct relationship between hospital bed supply and utilization rates.
• Previous studies have largely supported Roemer's Law in various healthcare settings.
• The applicability of Roemer's Law in diverse geographical and demographic contexts requires ongoing investigation.

Purpose of the Study:

• To examine the relationship between hospital bed supply, hospital services, and utilization rates in Iowa counties.
• To investigate the validity of Roemer's Law using patient origin data versus aggregate utilization data.
• To identify factors influencing healthcare utilization patterns in rural, urban, and suburban Iowa.

Main Methods:

• Analysis of hospital utilization data and patient origin data for Iowa counties.
• Statistical examination of the correlation between hospital beds per capita, number of unique hospital services, and utilization rates.
• Comparison of utilization patterns across rural, urban (MSA core), and suburban county types.

Main Results:

• Initial analysis suggested Roemer's Law holds in rural Iowa, with more beds correlating to higher utilization.
• However, analysis using patient origin data revealed no relationship between bed supply and utilization.
• A higher number of unique hospital services was associated with increased utilization, though weaker than the original Roemer effect.
• Suburban counties exhibited higher utilization rates compared to rural and urban core counties.

Conclusions:

• The observed relationship between bed supply and utilization may be a statistical artifact when using aggregate, non-patient-derived data.
• Hospital service variety, rather than bed capacity alone, appears to be a more significant driver of healthcare utilization in Iowa.
• Findings challenge the universal applicability of Roemer's Law and highlight the importance of data source methodology in healthcare research.