Do Markets Respond to Quality Information? The Case of Fertility Clinics

M. Kate Bundorf, Natalie Chun, Gopi Shah Goda, Daniel P. Kessler

NBER Working Paper No. 13888
Issued in March 2008
NBER Program(s):Health Care

Although policymakers have increasingly turned to provider report cards as a tool to improve health care quality, existing studies provide mixed evidence that they influence consumer choices. We examine the effects of providing consumers with quality information in the context of fertility clinics providing Assisted Reproductive Therapies (ART). We report three main findings. First, clinics with higher birthrates had larger market shares after relative to before the adoption of report cards. Second, clinics with a disproportionate share of young, relatively easy-to-treat patients had lower market shares after adoption versus before. This suggests that consumers take into account information on patient mix when evaluating clinic outcomes. Third, report cards had larger effects on consumers and clinics from states with ART insurance coverage mandates. We conclude that quality report cards have potential to influence provider behavior in this setting.

A non-technical summary of this paper is available in the 2008 number 2 issue of the NBER Bulletin on Aging and Health. You can sign up to receive the NBER Bulletin on Aging and Health by email.

Acknowledgments

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Document Object Identifier (DOI): 10.3386/w13888

Published: Bundorf, M. Kate & Chun, Natalie & Goda, Gopi Shah & Kessler, Daniel P., 2009. "Do markets respond to quality information? The case of fertility clinics," Journal of Health Economics, Elsevier, vol. 28(3), pages 718-727, May. citation courtesy of