National Trends in Market Competition for Hospital-Based Pediatric Services: 2011-2018

To examine, for the United States: (1) national trends in market competition using three approaches to operationalizing markets and (2) how competitive markets differ from concentrated ones for general newborn nurseries [GNNs], general pediatric inpatient units [GPIUs], neonatal intensive care units [NICUs], pediatric intensive care units [PICUs], and pediatric emergency departments [PEDs].

This study describes hospital markets for the above most common hospital-based pediatric service lines. Antitrust enforcement guidelines characterize market structures as: "Competitive," "Concentrated," or "Unavailable" if ≥ 5, 1-4, or zero hospitals within a market provide each service, respectively. Trends were determined by the share pediatric population residing in each market structure in 2018 compared with 2011 using three different approaches to operationalizing markets: Healthcare Referral Regions [HRR], Neonatal Intensive Care Regions [NICR], and Pediatric Emergency Referral Regions [PERR]. Competitive markets were compared with concentrated ones in 2018 using demographic data and hospital characteristics.

Data come from the Health Systems and Providers Database (HSPD) developed by the National Bureau of Economic Research and the American Community Survey. Since the HSPD provides a near census of US hospitals, only point estimates are presented.

Irrespective of how markets were operationalized, the share of the national pediatric population living in competitive markets increased for NICU (3%-8% increase), PICU (21%-35%), and PED (30%-76%) services and remained stable for GNN services over the study period. Directionality of the change in share living in competitive GPIU markets depended on how markets were operationalized. Using HRRs, competitive (relative to concentrated) markets exhibited smaller declines in pediatric population size, larger non-white populations, and higher prevalence of children's hospitals.

Market competitiveness for hospital-based pediatric services varies by service line, demographic and socioeconomic factors, and specific market definition used. Future studies should examine whether competitive markets offer better outcomes at lower prices and whether pediatric patients in concentrated markets require more protections.