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Market segmentation by profit status: evidence from hospice
David A Rosenkranz1, Lindsay White2, Chuxuan Sun3
1Department of Economics, Fordham University, 441 E Fordham Road, Dealy Hall, Bronx, NY 10458, United States.
Abstract:
How do referral networks and medical conditions determine where patients get care? We study this question in the US Hospice Industry, where for-profit hospice programs enroll more long-term care patients and more patients with Alzheimer's disease and related dementia. We find that for-profit hospice enrollees have 23% longer lifetime lengths-of-stay in hospice care than not for-profit hospice enrollees with the same medical conditions, institutional referral source, county of residence, and enrollment year. This and other differences in their end-of-life health care utilization suggest that hospice market segmentation is the result of a patient-specific selection mechanism that is partially independent of institutional barriers to hospice care.
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