Market reform in New Jersey and quality of care: a cautionary tale

As more that 40 states face present and projected deficits in their health care budgets, some legislatures are considering market-based reforms to control rising health care costs. This continues a trend begun in the 1990s that emphasized market competition over state regulation and mandates. However, little is known about the impact of many market-based reforms on quality of care. This Issue Brief evaluates the effect of one reform--the deregulation of hospital reimbursement rates in New Jersey--on one important outcome of care-mortality from acute myocardial infarction (heart attack). The findings serve as a reminder that cost-constraining reforms may reduce the quality of care, particularly for uninsured and other vulnerable populations.