TY  - JOUR
AU  - Ho, Kate
AU  - Pakes, Ariel
TI  - Hospital Choices, Hospital Prices and Financial Incentives to Physicians
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 19333
PY  - 2013
Y2  - August 2013
DO  - 10.3386/w19333
UR  - http://www.nber.org/papers/w19333
L1  - http://www.nber.org/papers/w19333.pdf
N1  - Author contact info:
Kate Ho
Princeton University
Department of Economics
237 Julis Romo Rabinowitz Building
Princeton, NJ 08544
E-Mail: kate.ho@princeton.edu

Ariel Pakes
Department of Economics
Harvard University
Littauer Room 117
Cambridge, MA 02138
Tel: 617/495-5320
Fax: 617/496-7352
E-Mail: apakes@fas.harvard.edu
M1  - published as Kate Ho, Ariel Pakes. "Hospital Choices, Hospital Prices and Financial Incentives to Physicians," in Amitabh Chandra, David M. Cutler, Robert S. Huckman, and Elizabeth Martinez, organizers, "Hospital Organization and Productivity" Health Affairs, vol. 33 issue 5, and vol. 33, issue 7 (May and July 2014) (2014)

AB  - We estimate an insurer-specific preference function which rationalizes hospital referrals for privately-insured births in California. The function is additively separable in: a hospital price paid by the insurer, the distance traveled, and plan and severity-specific hospital fixed effects (capturing hospital quality). We use an inequality estimator that allows for errors in price and detailed hospital-severity interactions and obtain markedly different results than those from a logit. The estimates indicate that insurers with more capitated physicians are more responsive to price. Capitated plans send patients further to utilize similar-quality lower-priced hospitals; but the cost-quality trade-off does not vary with capitation rates.
ER  -