Related Experiment Video
Updated: Jul 8, 2026
Improving IV Insulin Administration in a Community Hospital
Published on: June 11, 2012
Is the impact of managed care on hospital prices decreasing?
David Dranove1, Richard Lindrooth, William D White
1Northwestern University, Kellogg School of Management, 2001 Sheridan Road, Evanston, IL 60208-2013, USA. d-dranove@kellogg.northwestern.edu
Abstract:
Prior studies find that the growth of managed care through the early 1990s introduced a strong positive relationship between price and concentration in hospital markets. We hypothesize that the relaxation of constraints on consumer choice in response to a "managed care backlash" has diminished the price sensitivity of demand facing hospitals, reducing or possibly reversing the price-concentration relationship. We test this hypothesis by studying the price/concentration relationship for hospitals in California and Florida for selected years between 1990 and 2003, while addressing the potential endogeneity of concentration. We find an increasingly positive price/concentration in the 1990s with a peak occurring by 2001. Between 2001 and 2003, the growth in this relationship halts and possibly reverses.
Related Concept Videos
01:29Issues And Trends In Healthcare Delivery System
Cost Containment
Payment for healthcare services has historically promoted adoption of costly and often unnecessary or inefficient...
01:26Methods Of Healthcare Delivery System
Managed Care System:
The managed care system is designed to control the cost while maintaining the quality of care. The patient's care from admission to discharge is planned by the primary care provider or the case manager, also known as the gatekeeper. In a managed care system, the number of care providers is limited...
01:22Healthcare Associated Infections II: Preventive Measures
The best practices for preventing healthcare-associated infections include hand hygiene, patient risk...
01:30Health Information Technology and Healthcare Information System
Health Information Technology, commonly called HIT, integrates advanced information systems and technology in healthcare settings. Its primary functions include:
01:15Methods of Documentation VI: Case Management Model
For example, a patient with a chronic illness...
01:18Introduction To Health Care Delivery System
The Institute of Medicine (IOM) advocates for a patient-centered, effective, safe, timely, equitable, and effective healthcare system. The National Priorities...