TY  - JOUR
AU  - Kessler, Daniel
AU  - McClellan, Mark
TI  - Designing Hospital Antitrust Policy to Promote Social Welfare
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6897
PY  - 1999
Y2  - January 1999
DO  - 10.3386/w6897
UR  - http://www.nber.org/papers/w6897
L1  - http://www.nber.org/papers/w6897.pdf
N1  - Author contact info:
Daniel Kessler
Stanford University
434 Galvez Mall
Stanford, CA  94305
Tel: 650/723-0596
E-Mail: fkessler@stanford.edu

Mark B. McClellan
Director, Duke-Margolis Center for Health Policy
Robert J. Margolis MD Professor of
Business, Medicine and Policy
100 Fuqua Drive
Box 90120
Durham, NC 27708
Tel: 919.660.7963
Fax: NA
E-Mail: mark.mcclellan@duke.edu
M1  - published as Daniel Kessler, Mark McClellan. "Designing Hospital Antitrust Policy to Promote Social Welfare," in Alan M. Garber, editor, "Frontiers in Health Policy Research, volume 2" MIT Press (1999)

AB  - Applying principles of merger evaluation to the health care industry in general, and to hospital markets in particular, poses several unique challenges.  Definition of relevant geographic markets and assessment of the consequences of changes in competition for patient and social welfare are complicated by asymmetric information and moral hazard due to health insurance. We suggest a new empirical approach to assessing the impact of hospital competition which addresses the shortcomings of existing methods.  We then summarize our main results on the welfare consequences of competition.  We conclude with an illustration of how our methods can be used to assess the welfare implications of specific hospital mergers, and with some implications of our findings for antitrust policy.
ER  -