Policies towards hospital and GP competition in five European countries

Measuring competition in primary care-Evidence from Sweden

INTRODUCTION

In many tax-based healthcare systems, policymakers have introduced reforms that promote provider competition with the intention of improving the quality and efficiency. Healthcare competition is usually defined spatially, with local markets often being identified as a circle around each provider. We argue that existing local market definitions can be improved to better capture actual local markets. For pro-competition reforms to potentially lead to the gains envisioned by policymakers, a crucial condition is the actual emergence of competitive markets. However, limited research has been conducted on competition in primary care markets, despite primary care constituting a vital part of a healthcare system.

AIM

The study aims to contribute to the debate on how to define local markets geographically and to examine provider competition in Swedish primary care.

METHODS

A cross-sectional study was conducted using data on all individuals and all primary care providers in Sweden. Local markets were defined as: fixed radius (1 km and 3 km); variable radius; and variable shape-our new local market definition that allows markets to vary in both size and shape. Competition was measured using the Herfindahl-Hirschman index and a count of the number of competitors within the local market.

RESULTS

Fixed radius markets fail to capture variation within and across geographical areas. The variable radius and variable shape markets are similar but do not always identify the same competitors or level of competition. Furthermore, competition levels vary significantly in Swedish primary care. Many providers operate in monopoly markets, whereas others face high competition.

CONCLUSIONS

While the variable shape approach has the potential to better capture actual markets and more accurately identify competitors, further analyses are needed. Moreover, Swedish policymakers are advised to decide whether to still pursue competition and if so, take measures to improve local market conditions in monopolies.

Association of travel time, patient characteristics, and hospital quality with patient mobility for breast cancer surgery: A national population-based study

BACKGROUND

This national study investigated hospital quality and patient factors associated with treatment location for breast cancer surgery.

METHODS

By using linked administrative data sets from the English National Health Service, the authors identified all women diagnosed between January 2, 2016, and December 31, 2018, who underwent breast-conserving surgery (BCS) or a mastectomy with or without immediate breast reconstruction. The extent to which patients bypassed their nearest hospital was investigated using a geographic information system (ArcGIS). Conditional logistic regressions were used to estimate the impact of travel time, hospital quality, and patient characteristics.

RESULTS

22,622 Of 69,153 patients undergoing BCS, 22,622 (32.7%) bypassed their nearest hospital; and, of 23,536 patients undergoing mastectomy, 7179 (30.5%) bypassed their nearest hospital. Women who were younger, without comorbidities, or from rural areas were more likely to travel to more distant hospitals (p < .05). Patients undergoing BCS (odds ratio [OR], 1.85; 95% confidence interval [CI], 1.36-2.50) or mastectomy (OR, 1.52; 95% CI, 1.14-2.02) were more likely to be treated at specialist breast reconstruction centers despite not undergoing the procedure. Patients receiving mastectomy and immediate breast reconstruction were more likely to travel to hospitals employing surgeons who had a media reputation (OR, 2.41; 95% CI, 1.28-4.52). Patients undergoing BCS were less likely to travel to hospitals with shorter surgical waiting times (OR, 0.65; 95% CI, 0.46-0.92). The authors did not observe a significant impact for research activity, hospital quality rating, breast re-excision rates, or the status as a multidisciplinary cancer center.

CONCLUSIONS

Patient choice policies may drive inequalities in the health care system without improving patient outcomes.

Impact of interhospital competition on mortality of patients operated on for colorectal cancer faced to hospital volume and rurality: A cross-sectional study

INTRODUCTION

Contradictions remain on the impact of interhospital competition on the quality of care, mainly the mortality. The aim of the study is to evaluate the impact of interhospital competition on postoperative mortality after surgery for colorectal cancer in France.

METHODS

We conducted a retrospective cross-sectional study from 2015 to 2019. Data were collected from a National Health Database. Patients operated on for colorectal cancer in a hospital in mainland France were included. Competition was measured using number of competitors by distance-based approach. A mixed-effect model was carried out to test the link between competition and mortality.

RESULTS

Ninety-five percent (n = 152,235) of the 160,909 people operated on for colorectal cancer were included in our study. The mean age of patients was 70.4 ±12.2 years old, and female were more represented (55%). A total of 726 hospitals met the criteria for inclusion in our study. Mortality at 30 days was 3.6% and we found that the mortality decreases with increasing of the hospital activity. Using the number of competitors per distance method, our study showed that a "highly competitive" and "moderately competitive" markets decreased mortality by 31% [OR: 0.69 (0.59, 0.80); p<0.001] and by 12% respectively [OR: 0.88 (0.79, 0.99); p<0.03], compared to the "non-competitive" market. High hospital volume (100> per year) was also associated to lower mortality rate [OR: 0.74 (0.63, 0.86); p<0.001].

CONCLUSIONS

The results of our studies show that increasing hospital competition independently decreases the 30-day mortality rate after colorectal cancer surgery. Hospital caseload, patients' characteristics and age also impact the post-operative mortality.

How exposure to patient narratives affects stereotyped choices of primary care clinicians

In this paper, we examine whether patient narratives alter the impact of stereotyping on choice of primary care clinicians: in this case, the common presumption that female doctors will be more attentive to empathic relationships with patients. 1052 individuals were selected from a nationally representative Internet panel to participate in a survey experiment. Participants were given performance data about 12 fictitious primary care physicians, including a randomized set of narrative feedback from patients. We compared the choice of clinician made by participants who value bedside manner and were exposed to narratives in the experiment, compared to those valuing bedside manner who had not had this exposure. We estimated multivariate logistic regressions to assess whether exposure to patient comments that "disrupt" stereotypes influenced choice of physicians. Participants who saw patient comments and had previously reported caring about bedside manner had a 67% higher odds of choosing a female physician than those participants that did not see a patient comments, controlling for the content of the narratives themselves. When participants were exposed to patient comments that disrupt gendered stereotypes, they had a 40% lower odds of choosing a female physician. Simple exposure to patient narratives that do not clearly disrupt gendered stereotypes increased the likelihood of choosing a female clinician by priming attention to relational aspects of care. However, when the content of a sufficient proportion of patient comments runs counter stereotypes, even a minority of narratives is sufficient to disrupt gendered-expectations and alter choices.

Reasons for merging and collaborating in healthcare: Marriage or living apart together?

BACKGROUND

Across OECD countries, integration between healthcare organisations has become an indispensable part of contemporary healthcare provision. In recent years, inter-organisational collaboration has increasingly been encouraged in health and competition policy at the expense of mergers. Yet, understanding of whether healthcare organisations make an active choice between merging and collaborating is lacking. Hence, this study systematically examines (i) healthcare executives' motives for integration, (ii) their potential trade-offs between collaborating or merging, and (iii) the barriers to collaborating perceived by them.

METHODS

Early 2019, an online questionnaire was conducted among a nationwide panel of 714 healthcare executives in the Netherlands. Because of their strategic position within healthcare organisations as end-responsible managers, healthcare executives are especially suited to provide broad and in-depth knowledge on the internal and external processes and decisions. Three hundred thirty-seven Dutch healthcare executives completed the questionnaire (response rate 47%). This study sample was representative of the largest healthcare sectors in the Netherlands. In total, 137 mergers and 235 inter-organisational collaborations were reported. Both closed questions and open-ended questions were systematically analysed.

RESULTS

Improving or broadening healthcare provision is the foremost motive for mergers as well as inter-organisational collaborations. When considering both types, reducing governance complexity is one of the decisive reasons to opt for a merger, whereas aversion towards a full merger and lack of support base within the own organisation convinced healthcare executives to choose for a collaboration. When comparing specific healthcare sectors, the overlap in pursued motives and sub-motives indicates that inter-organisational collaborations and mergers are used for comparable objectives. Only a small minority of the responding executives switched between both types of integration. Institutional barriers, such as laws, regulations and financing regimes, appear to be the most restricting for healthcare executives to engage in inter-organisational collaborations.

CONCLUSIONS

Our integral approach and systematic comparison across sectors could serve policymakers, regulators and healthcare providers in aligning organisational objectives and societal objectives in decision-making on collaborations and mergers. Future research is recommended to study multiple collaboration and merger cases qualitatively for a detailed examination of decision-making by healthcare executives, and develop an integral assessment framework for balancing collaborations and mergers based on their effects in the medium to long term.

Association between hospital competition and quality of prostate cancer care

BACKGROUND

Hospitals account for approximately 6% of United States' gross domestic product. We examined the association between hospital competition and outcomes in elderly with localized prostate cancer (PCa). We also assessed if race moderated this association.

METHODS

Retrospective study using Surveillance, Epidemiology, and End Results (SEER) - Medicare database. Cohort included fee-for-service, African American and white men aged ≥ 66, diagnosed with localized PCa between 1998 and 2011 and their claims between 1997 and 2016. We used Hirschman-Herfindahl index (HHI) to measure of hospital competition. Outcomes were emergency room (ER) visits, hospitalizations, Medicare expenditure and mortality assessed in acute survivorship phase (two years post-PCa diagnosis), and long-term mortality. We used Generalized Linear Models for analyzing expenditure, Poisson models for ER visits and hospitalizations, and Cox models for mortality. We used propensity score to minimize bias.

RESULTS

Among 253,176 patients, percent change in incident rate of ER visit was 17% higher for one unit increase in HHI (IRR: 1.17, 95% CI: 1.15-1.19). Incident rate of ER was 24% higher for whites and 48% higher for African Americans. For one unit increase in HHI, hazard of short-term all-cause mortality was 7% higher for whites and 11% lower for African Americans. The hazard of long-term all-cause mortality was 10% higher for whites and 13% higher for African Americans.

CONCLUSIONS

Lower hospital competition was associated with impaired outcomes of localized PCa care. Magnitude of impairment was higher for African Americans, compared to whites. Future research will explore process through which competition affects outcomes and racial disparity.

Who benefits from quality competition in health care? A theory and a laboratory experiment on the relevance of patient characteristics

We study how competition between physicians affects the provision of medical care. In our theoretical model, physicians are faced with a heterogeneous patient population, in which patients systematically vary with regard to both their responsiveness to the provided quality of care and their state of health. We test the behavioral predictions derived from this model in a controlled laboratory experiment. In line with the model, we observe that competition significantly improves patient benefits as long as patients are able to respond to the quality provided. For those patients, who are not able to choose a physician, competition even decreases the patient benefit compared to a situation without competition. This decrease is in contrast to our theoretical prediction implying no change in benefits for passive patients. Deviations from patient-optimal treatment are highest for passive patients in need of a low quantity of medical services. With repetition, both, the positive effects of competition for active patients as well as the negative effects of competition for passive patients become more pronounced. Our results imply that competition can not only improve but also worsen patient outcome and that patients' responsiveness to quality is decisive.

Including mental health care in a model of European health system

The management of a health system is a matter of economics and business administration because of the costs induced by goods and services delivered. Economics teaches us that the positive effects induced by competition in free markets cannot be expected in health care, which is a classic example of market failure from both demand and supply sides. The most sensible key concepts to refer for managing a health system are funding and provision. While the logical solution for the first variable is universal coverage through general taxation, the second one requires a deeper understanding. Integrated care is the modern approach that better supports the choice in favour of the public sector also for service provision. A major threat against this approach is dual practice legally allowed for health professionals, which inevitably raises financial conflicts of interest. An exclusive contract of employment for civil servants should be the sine qua non for providing public services effectively and efficiently. Integrated care is particularly important for long-term chronic illnesses associated with high levels of disability, such as neurodegenerative diseases and mental disorders, where the mix of health and social services needed can be very complex. Nowadays the growing number of community-dwelling patients with multiple physical and mental health needs is the major challenge for the European health systems. This happens also in public health systems, which should provide universal health coverage in principle, and the case of mental disorders is striking. In the light of this theoretical exercise, we strongly believe that a public National Health and Social Service should be the most indicated model for both funding and providing health and social care in modern societies. The big challenge of the common model of European health system here envisaged would be to limit the negative influences of politics and bureaucracy.

Strengthening health system governance in Germany: looking back, planning ahead

Health system governance has been receiving increasing attention in health system research since the 1980s. The contemporary challenges that the German health system is faced with are often closely linked to governance issues. Although Germany has the highest health expenditure as a share of Gross Domestic Product (GDP) in the European Union (EU), the spending on healthcare is out of proportion to the health outcomes of the population. The reason for this lies mainly in the complexity of the German health system which is hard to steer due to several administrative levels in the country and numerous policy actors to whom the decision-making power on healthcare provision is delegated. In this paper, we present the results of focus group discussions on governance and build upon the insights gained through the Neustart project of the Robert Bosch Foundation. Based on an internationally recognised health governance framework from the World Health Organization (WHO), experts who work in, on or for the German health system addressed health governance challenges. They provided evidence-based recommendations for the new legislative period (2021-2025) on transparency, accountability, participation, integrity and capacity of the German health system.

Impact of patient choice and hospital competition on patient outcomes after rectal cancer surgery: A national population-based study

BACKGROUND

The objective of the current national cohort study was to analyze the correlation between choice and competition on outcomes after cancer surgery in rectal cancer.

METHODS

The analysis included all men who underwent rectal cancer surgery in the English National Health Service between March 2015 and April 2019 (n = 13,996). Multilevel logistic regression was used to assess the effect of a rectal cancer surgery center being located in a competitive environment (based on the number of centers within a threshold distance) and being a successful competitor (based on the ability to attract patients from other hospitals) on eight patient-level outcomes: 30- and 90-day emergency readmissions, 30-day re-operation rates, 90-day postoperative mortality, length of stay >14 days, circumferential resection margin status, rates of primary procedure with a permanent stoma, and rates of persistent stoma 18 months after anterior resection.

RESULTS

With adjustment for patient characteristics, patients who underwent surgery in centers located in a stronger competitive environment were less likely to have an abdominoperineal excision or a Hartman's procedure (odds ratio [OR], 0.73; 95% confidence interval [CI], 0.55-0.97, p = .04). Additionally, individuals who received treatment at hospitals that were successful competitors had a lower risk of a 90-day readmission following rectal cancer surgery (OR, 0.86; 95% CI, 0.76-0.97, p = .03) and were less likely to have a persistent stoma at 18 months after anterior resection (OR, 0.75; 95% CI, 0.61-0.93, p = .02).

CONCLUSIONS

Hospitals located in areas of high competition are associated with better patient outcomes and improved processes of care for rectal cancer surgery.

Association of Quality and Technology With Patient Mobility for Colorectal Cancer Surgery

Importance

Many health care systems publish hospital-level quality measures as a driver of hospital performance and to support patient choice, but it is not known if patients with cancer respond to them.

Objective

To investigate hospital quality and patient factors associated with treatment location.

Design, Setting, and Participants

This choice modeling study used national administrative hospital data. Patients with colon and rectal cancer treated in all 163 English National Health Service (NHS) hospitals delivering colorectal cancer surgery between April 2016 and March 2019 were included. The extent to which patients chose to bypass their nearest surgery center was investigated, and conditional logistic regression was used to estimate the association of additional travel time, hospital quality measures, and patient characteristics with treatment location.

Exposures

Additional travel time in minutes, hospital characteristics, and patient characteristics: age, sex, cancer T stage, socioeconomic status, comorbidity, and rural or urban residence.

Main Outcomes and Measures

Treatment location.

Results

Overall, 44 299 patients were included in the final cohort (mean [SD] age, 68.9 [11.6] years; 18 829 [42.5%] female). A total of 8550 of 31 258 patients with colon cancer (27.4%) and 3933 of 13 041 patients with rectal cancer (30.2%) bypassed their nearest surgical center. Travel time was strongly associated with treatment location. The association was less strong for younger, more affluent patients and those from rural areas. For rectal cancer, patients were more likely to travel to a hospital designated as a specialist colorectal cancer surgery center (odds ratio, 1.45; 95% CI, 1.13-1.87; P = .004) and to a hospital performing robotic surgery for rectal cancer (odds ratio, 1.43; 95% CI, 1.11-1.86; P = .007). Patients were less likely to travel to hospitals deemed to have inadequate care by the national quality regulator (odds ratio, 0.70; 95% CI, 0.50-0.97; P = .03). Patients were not more likely to travel to hospitals with better 2-year bowel cancer mortality outcomes.

Conclusions and Relevance

Patients appear responsive to hospital characteristics that reflect overall hospital quality and the availability of robotic surgery but not to specific disease-related outcome measures. Policies allowing patients to choose where they have colorectal cancer surgery may not result in better outcomes but could drive inequities in the health care system.

Associations of hospital volume and hospital competition with short-term, middle-term and long-term patient outcomes after breast cancer surgery: a retrospective population-based study

OBJECTIVES

For oncological care, there is a clear tendency towards centralisation and collaboration aimed at improving patient outcomes. However, in market-based healthcare systems, this trend is related to the potential trade-off between hospital volume and hospital competition. We analyse the association between hospital volume, competition from neighbouring hospitals and outcomes for patients who underwent surgery for invasive breast cancer (IBC).

OUTCOME MEASURES

Surgical margins, 90 days re-excision, overall survival.

DESIGN, SETTING, PARTICIPANTS

In this population-based study, we use data from the Netherlands Cancer Registry. Our study sample consists of 136 958 patients who underwent surgery for IBC between 2004 and 2014 in the Netherlands.

RESULTS

Our findings show that treatment types as well as patient and tumour characteristics explain most of the variation in all outcomes. After adjusting for confounding variables and intrahospital correlation in multivariate logistic regressions, hospital volume and competition from neighbouring hospitals did not show significant associations with surgical margins and re-excision rates. For patients who underwent surgery in hospitals annually performing 250 surgeries or more, multilevel Cox proportional hazard models show that survival was somewhat higher (HR 0.94). Survival in hospitals with four or more (potential) competitors within 30 km was slightly higher (HR 0.97). However, this effect did not hold after changing this proxy for hospital competition.

CONCLUSIONS

Based on the selection of patient outcomes, hospital volume and regional competition appear to play only a limited role in the explanation of variation in IBC outcomes across Dutch hospitals. Further research into hospital variation for high-volume tumours like the one studied here is recommended to (i) use consistently measured quality indicators that better reflect multidisciplinary clinical practice and patient and provider decision-making, (ii) include more sophisticated measures for hospital competition and (iii) assess the entire process of care within the hospital, as well as care provided by other providers in cancer networks.

Resilient managed competition during pandemics: lessons from the Italian experience during COVID-19

In the last decades, several European health systems have abandoned their vertically integrated health care in favour of some form of managed competition (MC), either in a centralised or decentralised format. However, during a pandemic, MC may put health systems under additional strain as they are designed to follow some form of 'organisational self-interest', and hence face reduced incentives for both provider coordination (e.g. temporary hospital close down, change in the case-mix), and information sharing. We illustrate our argument using evidence for the Covid-19 pandemic outbreak in Italy during March and April 2020, which calls for the development of 'coordination mechanisms' at times of a health emergency.

Investment and quality competition in healthcare markets

We study the strategic relationship between hospital investment and provision of service quality. We use a spatial competition framework and allow investment and quality to be complements or substitutes in patient benefit and provider cost. We assume that each hospital commits to a certain investment before deciding on service quality, and that investment is observable and contractible while quality is observable but not contractible. We show that, under a fixed DRG-pricing system, providers' lack of ability to commit to quality leads to under- or overinvestment, relative to the first-best solution. Underinvestment arises when the price-cost margin is positive, and quality and investments are strategic complements, which has implications for optimal contracting. Differently from the simultaneous-move case, the regulator must complement the payment with one more instrument to address under/overinvestment. We also analyse the welfare effects of different policy options (separate payment for investment, higher per-treatment prices, or DRG-refinement policies).

Heterogeneous effects of hospital competition on inpatient expenses: an empirical analysis of diseases grouping basing on conditions' complexity and urgency

Background

Multiple pro-competition policies were implemented during the new round of healthcare reform in China. Differences in conditions’ complexity and urgency across diseases associating with various degrees of information asymmetry and choice autonomy in the process of care provision, would lead to heterogeneous effects of competition on healthcare expenses. However, there are limited studies to explore it. This study aims to examine the heterogeneous effects of hospital competition on inpatient expenses basing on disease grouping according to conditions’ complexity and urgency.

Methods

Collecting information from discharge data of inpatients and hospital administrative data of Sichuan province in China, we selected representative diseases. K-means clustering was used to group the selected diseases and Herfindahl-Hirschman Index (HHI) was calculated based on the predicted patient flow to measure the hospital competition. The log-linear multivariate regression model was used to examine the heterogeneous effects of hospital competition on inpatient expenses.

Results

We selected 19 representative diseases with significant burdens (more than 1.1 million hospitalizations). The selected diseases were divided into three groups, including diseases with highly complex conditions, diseases with urgent conditions, and diseases with less complex and less urgent conditions. For diseases with highly complex conditions and diseases with urgent conditions, the estimated coefficients of HHI are mixed in the direction and statistical significance in the identical regression model at the 5% level. For diseases with less complex and less urgent conditions, the coefficients of HHI are all positive, and almost all of them significant at the 5% level.

Conclusions

We found heterogeneous effects of hospital competition on inpatient expenses across disease groups: hospital competition does not play an ideal role in reducing inpatient expenses for diseases with highly complex conditions and diseases with urgent conditions, but it has a significant effect in reducing inpatient expenses of diseases with less complex and less urgent conditions. Our study offers implications that the differences in condition’s complexity and urgency among diseases would lead to different impacts of hospital competition, which would be given full consideration when designing the pro-competition policy in the healthcare delivery system to achieve the desired goal.

Supplementary Information

The online version contains supplementary material available at 10.1186/s12913-021-07331-1.

Director's Perceived Competition and Its Relationship with Hospital's Competitive Behaviors: Evidence from County Hospitals in China

Background

This study was conducted for assessing the degrees of perceived competition reported by county hospital directors in rural China as well as hospitals’ competitive behaviors in response to competition.

Methods

The data were collected from Analysis of Provider Payment Reforms on Advancing China’s Health (APPROACH) project which had been implemented among county hospitals in China’s Guizhou province. Competition was measured by asking hospital directors to rate the levels of competitive pressure as they perceived. Hospitals’ competitive behaviors were obtained by asking hospitals’ directors about specific strategies they had adopted. A multivariable linear regression model was developed to examine the relationship between perceived competition and the positivity of competitive behavior, and multivariable logistic regressions were used to evaluate the influence of perceived competition on the adoption of specific competitive strategies.

Results

Among 218 directors engaged in this study, 210 (96.3%) directors reported the perception of certain degrees of competition, for which the competitive pressure was mainly posed by public hospitals (42.4%). Director-perceived competition level was found to be positively associated with the positivity of competitive behavior, and directors under higher competitive pressure were found to be more likely to adopt multiple competitive strategies including improving the efficiency of hospitals’ internal management, optimizing hospitals’ environment as well as promoting health-care services.

Conclusion

This study suggested that almost all of the county hospital directors in rural China perceived certain degrees of competitive pressure, and higher levels of perceived competition were found to be significantly associated with increased positivity in adopting competitive strategies. Our findings are expected to provide evidence-based implications for the implementation of a series of pro-competition policies throughout health-care reforms.

The Comparison Between Different Hospital Market Definition Approaches: An Empirical Analysis of 11 Representative Diseases in Sichuan Province, China

Objective: This study aims to provide empirical evidence for the controversy about whether the inference is consistent if alternative hospital market definition methods are employed, and for which definition method is the best alternative to the predicted patient flow approach.

Data sources: Collecting data from the discharge data of inpatients and hospital administrative data of Sichuan province in China in the fourth quarter of 2018.

Study Design: We employed Herfindahl–Hirschman Index (HHI) as the proxy of market competition used as an example to measure the hospital market structure. Correlation coefficients of HHIs based on different definition methods were assessed. The corresponding coefficient of each HHI estimated in identical regression models was then compared. In addition, since the predicted patient flow method has been argued by the literature of its advantages compared with the previous approaches, we took the predicted patient flow as a reference to compare with the other approaches.

Data Extraction Methods: We selected the common diseases with a significant burden, and 11 diseases were included (902,767 hospitalizations).

Principal Findings: The correlation coefficients of HHIs based on different market definition methods are all significantly greater than 0, and the coefficients of HHIs are different in identical regression models. Taking the predicted patient flow approach as a reference, we found that the correlation coefficients between HHIs based on fixed radius and predicted patient flow approach is larger than others, and their parameter estimates are all consistent.

Conclusion: Although the HHIs based on different definition methods are significantly and positively correlated, the inferences about the effectiveness of market structure would be inconsistent when alternative market definition methods are employed. The fixed radius would be the best alternative when researchers want to use the predicted patient flow method to define the hospital market but are hindered by the data limitations and computational complexity.

Does hospital competition lead to medical equipment expansion? Evidence on the medical arms race

With the implementation of a series of pro-competition policies in China, the hospital market competition has been intensified dramatically over the past decade. Based on previous literature, such competition is very much likely to bring about an upgoing trend in the promotion and expansion of medical facilities among hospitals as an essential strategy for attracting patients, which is known as Medical Arms Race (MAR). Comprehensive evaluations have been conducted by previous studies on the consequences of the MAR, which, however, merely provided inadequate empirical evidence on the relationship between hospital competition and MAR. Utilizing the variations in hospital competition across various regions and through different time periods in Sichuan Province as a prototype representative of the nationwide situation, a dynamic panel data model was established and adopted in this study for investigating whether intensified hospital competition had resulted in the expansion of medical facilities in China during the corresponding time period. The geopolitical boundaries and Herfindahl-Hirschman Index (HHI) were respectively employed to define the hospital market and measure the competition degree. We found that a 10% reduction in HHI is associated with an 8.79% increase in regional total costs of advanced medical equipment per capita, suggesting that hospital competition would lead to medical equipment expansion. Our results provide novel evidence on MAR which is particularly applicable for the healthcare system in China, providing suggestions for nationwide healthcare reform in order to mitigate potential negative outcomes induced by the implementation of pro-competition policies.

As predicted by theory: choice and competition in a publicly funded and regulated regional health system yield improved access and cost control

BACKGROUND

New Public Management (NPM) has been widely used to introduce competition into public healthcare. Results have been mixed, and there has been much controversy about the appropriateness of a private sector-mimicking governance model in a public service. One voice in the debate suggested that rather than discussing whether competition is "good" or "bad" the emphasis should be on exploring the conditions for a successful implementation.

METHODS

We report a longitudinal case study of the introduction of patient choice and allowing private providers to enter a publicly funded market. Patients in need of hip or knee replacement surgery are allowed to choose provider, and those are paid a fixed reimbursement for the full care episode (bundled payment). Providers are financially accountable for complications. Data on number of patients, waiting lists and times, costs to the public purchaser, and complications were collected from public registries. Providers were interviewed at three points in time during a nine-year follow-up period. Time-series of the quantitative data were exhibited and the views of actors involved were explored in a thematic analysis of the interviews.

RESULTS

The policy goals of improving access to care and care quality while controlling total costs were achieved in a sustained way. Six themes were identified among actors interviewed and those were consistent over time. The design of the patient choice model was accepted, although all providers were discontent with the level of reimbursement. Providers felt that quality, timeliness of service and staff satisfaction had improved. Public and private providers differed in terms of patient-mix and developed different strategies to adjust to the reimbursement system. Private providers were more active in marketing and improving operation room efficiency. All providers intensified cooperation with referring physicians. Close attention was paid to following the rules set by the purchaser.

DISCUSSION AND CONCLUSIONS

The sustained cost control was an effect of bundled payment. What this study shows is that both public and private providers adhere long-term to regulations by a public purchaser that also controls entrance to the market. The compensation was fixed and led to competition on quality, as predicted by theory.

Administration of Strategic Agreements in Public Hospitals: Considerations to Enhance the Quality and Sustainability of Mergers and Acquisitions

Merger processes between hospitals have high benefit potential for patients, staff and managers. This integration of health centres can improve the quality and safety in patient care. Additionally, cooperative processes enhance the sustainability of the health system, by increasing team spirit, giving innovative ideas and improving staff satisfaction. In this article, the critical factors for successful hospital mergers and acquisitions in the Public Health System were considered to develop a brief guide to help with the organisation of a merger process. Five sections were designed: Strategic administration and objectives, Staff management, New hospital complex structure, Processes and Results. This guide facilitates the communication between a variety of stakeholders, thus improving the engagement between all members of the new healthcare system. This could be particularly important for countries with large regional variance in the organisation of health care and resources.

Inter-organizational collaboration between healthcare providers

Across OECD countries, healthcare organizations increasingly rely on inter-organizational collaboration (IOC). Yet, systematic insight into the relations across different healthcare sectors is lacking. The aim of this explorative study is twofold. First, to understand how IOC differs across healthcare sectors with regards to characteristics, motives and the role of health policy. Second, to understand which potential effects healthcare executives consider prior to the establishment of the collaborations. For this purpose, a survey was conducted among a representative panel of Dutch healthcare executives from medium-sized or large healthcare organizations. Almost half (n = 344, 48%) of the invited executives participated. Our results suggest that differences in policy changes and institutional developments across healthcare sectors affect the scope and type of IOC: hospitals generally operate in small horizontal collaborations, while larger and more complex mixed and non-horizontal collaborations are more present among nursing homes, disability care and mental care organizations. We find that before establishing IOCs, most healthcare executives conduct a self-assessment including the potential effects of the collaboration. The extensive overview of policy developments, collaboration types and intended outcomes presented in our study offers a useful starting point for a more in-depth assessment of the effectiveness of collaborations among healthcare organizations.

Do small hospitals have lower quality? Evidence from the English NHS

We investigate the extent to which small hospitals are associated with lower quality. We first take a patient perspective, and test if, controlling for casemix, patients admitted to small hospitals receive lower quality than those admitted to larger hospitals. We then investigate if differences in quality between large and small hospitals can be explained by hospital characteristics such as hospital type and staffing. We use a range of quality measures including hospital mortality rates (overall and for specific conditions), hospital acquired infection rates, waiting times for emergency patients, and patient perceptions of the care they receive. We find that small hospitals, with fewer than 400 beds, are generally not associated with lower quality before or after controlling for hospital characteristics. The only exception is heart attack mortality, which is generally higher in small hospitals.

Does managed competition constrain hospitals' contract prices? Evidence from the Netherlands

In the Dutch health care system, health insurers negotiate with hospitals about the pricing of hospital products in a managed competition framework. In this paper, we study these contract prices that became for the first time publicly available in 2016. The data show substantive price variation between hospitals for the same products, and within a hospital for the same product across insurers. About 27% of the contract prices for a hospital product are at least 20% higher or lower than the average contract price in the market. For about half of the products, the highest and the lowest contract prices across hospitals differ by a factor of three or more. Moreover, hospital product prices do not follow a consistent ranking across hospitals, suggesting substantial cross-subsidization between hospital products. Potential explanations for the large and seemingly random price variation are: (i) different cost pricing methods used by hospitals, (ii) uncertainty due to frequent changes in the hospital payment system, (iii) price adjustments related to negotiated lumpsum payments and (iv) differences in hospital and insurer market power. Several policy options are discussed to reduce variation and increase transparency of hospital prices.

Is there scope for mixed markets in the provision of hospital care?

Market oriented reforms in hospital care have produced a variety of quasi markets that differ for the type of providers that are allowed to compete. Mixed markets, where public hospitals compete alongside private ones, are increasingly common, but the literature does not agree on their performances and their desirability. We review the contributions in this field by proposing a common framework which allows to account for the different approaches proposed to model public hospitals. In this paper we show under which conditions mixed markets perform better in terms of average quality, and we review the empirical literature to determine whether these conditions are met. In general, pure forms (private or public competition) are superior to mixed markets, unless patients interpret public hospitals as reference suppliers, and quality of care is important. The empirical evidence on these key questions shows that public hospitals behave differently from private organisations, but they are not necessarily less efficient. Research into patients choices seems to suggest that ownership is a value, but the empirical literature is still rather scant. From a policy point of view, our review suggests that there does not seem to be a clear answer to whether this market form should be used. Local conditions are going to play an important role.

Dynamic hospital competition under rationing by waiting times

We develop a dynamic model of hospital competition where (i) waiting times increase if demand exceeds supply; (ii) patients choose a hospital based in part on waiting times; and (iii) hospitals incur waiting time penalties. We show that, whereas policies based on penalties will lead to lower waiting times, policies that promote patient choice will instead lead to higher waiting times. These results are robust to different game-theoretic solution concepts, designs of the hospital penalty structure, and patient utility specifications. Furthermore, waiting time penalties are likely to be more effective in reducing waiting times if they are designed with a linear penalty structure, but the counterproductive effect of patient choice policies is smaller when penalties are convex. These conclusions are partly derived by calibration of our model based on waiting times and elasticities observed in the English NHS for a common treatment (cataract surgery).

Does hospital competition improve efficiency? The effect of the patient choice reform in England

We use the 2006 relaxation of constraints on patient choice of hospital in the English NHS to investigate the effect of hospital competition on dimensions of efficiency including indicators of resource management (admissions per bed, bed occupancy rate, proportion of day cases, and cancelled elective operations) and costs (reference cost index for overall and elective activity, cleaning services costs, laundry and linen costs). We employ a quasi differences-in-differences approach and estimate seemingly unrelated regressions and unconditional quantile regressions with data on hospital trusts from 2002/2003 to 2010/2011. Our findings suggest that increased competition had mixed effects on efficiency. An additional equivalent rival increased admissions per bed by 1.1%, admissions per doctor by 0.9% and the proportion of day cases by 0.38 percentage points, but it also increased the number of cancelled elective operations by 2.5%.

The 2017 reform of the hospital sector in Poland - The challenge of consistent design

Beginning in October 2017 a system of basic hospital service provision, popularly called the 'hospitals network' was implemented in Poland. It covered 594 hospitals out of a total number of approx. 920 operating in 2017. The regulation's official objectives were to: "(1) improve the organization of services delivered by hospitals; (2) improve access to hospital care; (3) optimize the number of specialist wards; (4) improve coordination of in- and out-patient care; (5) facilitate hospital management". The aim of this paper is to describe the background of the reform planning and its formal objectives, content and implementation process, as well as to assess the preliminary results and discuss the possible limitations and implications. Although the official term 'hospitals network' is used to describe the reform, in practice it does not involve an element of cooperation between hospitals. The regulation's main feature was changing the financing methods for a pre-defined scope of services (from per-case to global budget).The reform was planned and implemented on a rather ad-hoc basis while its major controversy is the lack of quality of care, health outcome and population health need measures in the network inclusion criteria. The assessment of the reform's impact on service provision requires long-term analysis and access to detailed quantitative data.

Impact of patient choice and hospital competition on patient outcomes after prostate cancer surgery: A national population-based study

BACKGROUND

Policies that encourage patient choice and hospital competition have been introduced across several countries with the purpose of improving the quality of health care services. The objective of the current national cohort study was to analyze the correlation between choice and competition on outcomes after cancer surgery using prostate cancer as a case study.

METHODS

The analyses included all men who underwent prostate cancer surgery in the United Kingdom between 2008 and 2011 (n = 12,925). Multilevel logistic regression was used to assess the effect of a radical prostatectomy center being located in a competitive environment (based on the number of centers within a threshold distance) and being a successful competitor (based on the ability to attract patients from other hospitals) on 3 patient-level outcomes: postoperative length of hospital stay >3 days, 30-day emergency readmissions, and 2-year urinary complications.

RESULTS

With adjustment for patient characteristics, men who underwent surgery in centers located in a stronger competitive environment were less likely to have a 30-day emergency readmission, irrespective of the type or volume of procedures performed at each center (odds ratio, 0.46; 95% confidence interval, 0.36-0.60; P = .005). Men who received treatment at centers that were successful competitors were less likely to have a length of hospital stay >3 days (odds ratio, 0.49; 95% confidence interval, 0.25-0.94; P = .02).

CONCLUSIONS

The current results suggest for the first time that hospital competition improves short-term outcomes after prostate cancer surgery. Further evaluation of the potential role of patient choice and hospital competition is required to inform health service design in contrast to the role of top-down-driven approaches, which have focused on centralization of services.

Regional regulators in health care service under quality competition: A game theoretical model

In several countries, health care services are provided by public and/or private subjects, and they are reimbursed by the government, on the basis of regulated prices (in most countries, diagnosis-related group). Providers take prices as given and compete on quality to attract patients. In some countries, regulated prices differ across regions. This paper focuses on the interdependence between regional regulators within a country: It studies how price setters of different regions interact, in a simple but realistic framework. Specifically, we model a circular city as divided in two administrative regions. Each region has two providers and one regulator, who sets the local price. Patients are mobile and make their choice on the basis of provider location and service quality. Interregional mobility occurs in the presence of asymmetries in providers' cost efficiency, regulated prices, and service quality. We show that the optimal regulated price is higher in the region with the more efficient providers; we also show that decentralisation of price regulation implies higher expenditure but higher patients' welfare.

Choice in the presence of experts: The role of general practitioners in patients' hospital choice

This paper considers the micro-econometric analysis of patients' hospital choice for elective medical procedures when their choice set is pre-selected by a general practitioner (GP). GPs have a dual role with regard to elective referrals in the English NHS, advising patients and at the same time taking account of the financial implications of referral decisions on local health budgets. The paper proposes a two-stage choice model that encompasses both patient and GP level optimization. It demonstrates that estimators that do not take account of strategic pre-selection of choice sets may be biased and inconsistent. We find that GPs as patients' agents select choice options based on quality, but as agents of health authorities also consider financial implications of referrals. When considering these choice options, patients focus on tangible hospital attributes, like amenities.

Competition in health care: lessons from the English experience

The use of competition and the associated increase in choice in health care is a popular reform model, adopted by many governments across the world. Yet it is also a hotly contested model, with opponents seeing it, at best, as a diversion of energy or a luxury and, at worst, as leading to health care inequality and waste. This paper subjects the use of competition in health care to scrutiny. It begins by examining the theoretical case and then argues that only by looking at evidence can we understand what works and when. The body of the paper examines the evidence for England. For 25 years the United Kingdom has been subject to a series of policy changes which exogenously introduced and then downplayed the use of competition in health care. This makes England a very useful test bed. The paper presents the UK reforms and then discusses the evidence of their impact, examining changes in outcomes, including quality, productivity and the effect on the distribution of health care resources across socio-economic groups. The final section reflects on what can be learnt from these findings.

Socioeconomic inequality of access to healthcare: Does choice explain the gradient?

Equity of access is a key policy objective in publicly-funded healthcare systems. However, observed inequalities of access by socioeconomic status may result from differences in patients' choices. Using data on non-emergency coronary revascularisation procedures in the English National Health Service, we found substantive differences in waiting times within public hospitals between patients with different socioeconomic status: up to 35% difference, or 43 days, between the most and least deprived population quintile groups. Using selection models with differential distances as identification variables, we estimated that only up to 12% of these waiting time inequalities can be attributed to patients' choices of hospital and type of treatment (heart bypass versus stent). Residual inequality, after allowing for choice, was economically significant: patients in the least deprived quintile group benefited from shorter waiting times and the associated health benefits were worth up to £850 per person.

Effect of patient choice and hospital competition on service configuration and technology adoption within cancer surgery: a national, population-based study

Background

There is a scarcity of evidence about the role of patient choice and hospital competition policies on surgical cancer services. Previous evidence has shown that patients are prepared to bypass their nearest cancer centre to receive surgery at more distant centres that better meet their needs. In this national, population-based study we investigated the effect of patient mobility and hospital competition on service configuration and technology adoption in the National Health Service (NHS) in England, using prostate cancer surgery as a model.

Methods

We mapped all patients in England who underwent radical prostatectomy between Jan 1, 2010, and Dec 31, 2014, according to place of residence and treatment location. For each radical prostatectomy centre we analysed the effect of hospital competition (measured by use of a spatial competition index [SCI], with a score of 0 indicating weakest competition and 1 indicating strongest competition) and the effect of being an established robotic radical prostatectomy centre at the start of 2010 on net gains or losses of patients (difference between number of patients treated in a centre and number expected based on their residence), and the likelihood of closing their radical prostatectomy service.

Findings

Between Jan 1, 2010, and Dec 31, 2014, 19 256 patients underwent radical prostatectomy at an NHS provider in England. Of the 65 radical prostatectomy centres open at the start of the study period, 23 (35%) had a statistically significant net gain of patients during 2010–14. Ten (40%) of these 23 were established robotic centres. 37 (57%) of the 65 centres had a significant net loss of patients, of which two (5%) were established robotic centres and ten (27%) closed their radical prostatectomy service during the study period. Radical prostatectomy centres that closed were more likely to be located in areas with stronger competition (highest SCI quartile [0·87–0·92]; p=0·0081) than in areas with weaker competition. No robotic surgery centre closed irrespective of the size of net losses of patients. The number of centres performing robotic surgery increased from 12 (18%) of the 65 centres at the beginning of 2010 to 39 (71%) of 55 centres open at the end of 2014.

Interpretation

Competitive factors, in addition to policies advocating centralisation and the requirement to do minimum numbers of surgical procedures, have contributed to large-scale investment in equipment for robotic surgery without evidence of superior outcomes and contributed to the closure of cancer surgery units. If quality performance and outcome indicators are not available to guide patient choice, these policies could threaten health services' ability to deliver equitable and affordable cancer care.

Funding

National Institute for Health Research.

Do hospitals respond to rivals' quality and efficiency? A spatial panel econometric analysis

We investigate whether hospitals in the English National Health Service change their quality or efficiency in response to changes in quality or efficiency of neighbouring hospitals. We first provide a theoretical model that predicts that a hospital will not respond to changes in the efficiency of its rivals but may change its quality or efficiency in response to changes in the quality of rivals, though the direction of the response is ambiguous. We use data on eight quality measures (including mortality, emergency readmissions, patient reported outcome, and patient satisfaction) and six efficiency measures (including bed occupancy, cancelled operations, and costs) for public hospitals between 2010/11 and 2013/14 to estimate both spatial cross-sectional and spatial fixed- and random-effects panel data models. We find that although quality and efficiency measures are unconditionally spatially correlated, the spatial regression models suggest that a hospital's quality or efficiency does not respond to its rivals' quality or efficiency, except for a hospital's overall mortality that is positively associated with that of its rivals. The results are robust to allowing for spatially correlated covariates and errors and to instrumenting rivals' quality and efficiency.

Hospital Quality Factors Influencing the Mobility of Patients for Radical Prostate Cancer Radiation Therapy: A National Population-Based Study

Purpose

To investigate whether patients requiring radiation treatment are prepared to travel to alternative more distant centers in response to hospital choice policies, and the factors that influence this mobility.

Methods and Materials

We present the results of a national cohort study using administrative hospital data for all 44,363 men who were diagnosed with prostate cancer and underwent radical radiation therapy in the English National Health Service between 2010 and 2014. Using geographic information systems, we investigated the extent to which men choose to travel beyond (“bypass”) their nearest radiation therapy center, and we used conditional logistic regression to estimate the effect of hospital and patient characteristics on this mobility.

Results

In all, 20.7% of men (n=9161) bypassed their nearest radiation therapy center. Travel time had a very strong impact on where patients moved to for their treatment, but its effect was smaller for men who were younger, more affluent, and from rural areas (P for interaction always <.001). Men were prepared to travel further to hospitals that offered hypofractionated prostate radiation therapy as their standard schedule (odds ratio 3.19, P<.001), to large-scale radiation therapy units (odds ratio 1.56, P<.001), and to hospitals that were early adopters of intensity modulated radiation therapy (odds ratio 1.37, P<.001).

Conclusions

Men with prostate cancer are prepared to bypass their nearest radiation therapy centers. They are more likely to travel to larger established centers and those that offer innovative technology and more convenient radiation therapy schedules. Indicators that accurately reflect the quality of radiation therapy delivered are needed to guide patients' choices for radiation therapy treatment. In their absence, patient mobility may negatively affect the efficiency and capacity of a regional or national radiation therapy service and offer perverse incentives for technology adoption.

Determinants of Patient Mobility for Prostate Cancer Surgery: A Population-based Study of Choice and Competition

Many countries have introduced policies that enable patients to select a health care provider of their choice with the aim of improving the quality of care. However, there is little information about the drivers or the impact of patient mobility. Using administrative hospital data (n=19256) we analysed the mobility of prostate cancer patients who had radical surgery in England between 2010 and 2014. Our analysis, using geographic information systems and multivariable choice modelling, found that 33·5% (n=6465) of men bypassed their nearest prostate cancer surgical centre. Travel time had a strong impact on where patients moved to but was less of a factor for men who were younger, fitter, and more affluent (p always < 0.001). Men were more likely to move to hospitals that provided robotic prostate cancer surgery (odds ratio: 1.42, p<0.001) and to hospitals that employed surgeons with a strong media reputation (odds ratio: 2.18, p<0.001). Patient mobility occurred in the absence of validated measures of the quality of care, instead influenced by the adoption of robotic surgery and the reputation of individual clinicians. National policy based on patient choice and provider competition may have had a negative impact on equality of access, service capacity, and health system efficiency.

PATIENT SUMMARY

In this study, we assessed the reasons why men would choose to have prostate cancer surgery at a centre other than their nearest. We found that in England men were attracted to centres that carried out robotic surgery and employed surgeons with a national reputation.