New evidence on hospital profitability by payer group and the effects of payer generosity
Language: 
English
Abstract: 

This study provides (a) new estimates of U.S. hospital profitability by payer group, controlling for hospital characteristics, and (b) evidence about the intensity of care for particular diseases associated with the generosity of the patient's payer and other payers at the same hospital. The conceptual framework is a variant of the well-known model of a local monopolist selling in a segmented market. Effects of two kinds of regulation are considered. The data are taken from hospital accounting reports in four states in FY2000, and detailed discharge summaries from the Healthcare Cost and Utilization Project of the Agency for Healthcare Research and Quality. The profitability of inpatient care for privately insured patients was found to be about 4% less than for Medicare, but 14% higher than for Medicaid and only 9% higher than for self-pay patients. We found significant direct associations but not external effects of payer generosity on the intensity of care.

Author(s): 
Friedman, Bernard
Sood, Neeraj
Engstrom, Kelly
McKenzie, Diane
Item Type: 
Journal Article
Publication Title: 
International Journal of Health Care Finance and Economics
Journal Abbreviation: 
Int J Health Care Finance Econ
Publication Date: 
2004-09
Publication Year: 
2004
Pages: 
231-246
Volume: 
4
Issue: 
3
ISSN: 
1389-6563
DOI: 
10.1023/B:IHFE.0000036048.26098.9d
Library Catalog: 
PubMed
Extra: 
PMID: 15277780

Turabian/Chicago Citation

Bernard Friedman, Neeraj Sood, Kelly Engstrom and Diane McKenzie. 2004-09. "New evidence on hospital profitability by payer group and the effects of payer generosity." International Journal of Health Care Finance and Economics 4: 3: 231-246. 10.1023/B:IHFE.0000036048.26098.9d.

Wikipedia Citation

<ref> {{Cite journal | doi = 10.1023/B:IHFE.0000036048.26098.9d | issn = 1389-6563 | volume = 4 | pages = 231-246 | last = Friedman | first = Bernard | coauthors = Sood, Neeraj, Engstrom, Kelly, McKenzie, Diane | title = New evidence on hospital profitability by payer group and the effects of payer generosity | journal = International Journal of Health Care Finance and Economics | date = 2004-09 | pmid = | pmc = }} </ref>