Seminar: The Effect of Health Care Market Reforms on Volume and Costs in Dutch Hospitals—A Panel Data Study

The Effect of Health Care Market Reforms on Volume and Costs in Dutch Hospitals: A Panel Data Study

with Yvonne Krabbe, Tom Groot, and Jaap Boter (Vrije Universiteit, Amsterdam)

This seminar will present a paper on the effect of spatial concentration of general hospitals and health insurers on production volume and costs since the introduction of market-oriented health care reforms in the Netherlands. The market reforms were intended to reduce hospital production by providing more buying power to health insurance companies.

Findings: Apparently, under the new quasi-market system, both hospital and physician are able to maximize income by increasing health care production. An analysis of patient treatment data of 1,345,144 patient-level hospital data for fifteen major Diagnosis Treatment Combinations (a Dutch version of DRG) shows that for most DBC’s volume has increased since the health care reforms took effect. Surprisingly, neither spatial concentration of hospitals or insurers affects cost or production, suggesting that health insurers are unable to control volume by selective contracting. In addition, the number of specialized Independent Treatment Centers (ITCs; in Dutch: Zelfstandige Behandelcentra: ZBC’s) in the vicinity of hospitals has a moderate positive association with average costs and a negative association with production volume, likely explained by ITCs taking the simpler cases, leaving the hospital the more complex cases.

Further details on the seminar speaker Prof Tom Groot, one of the co-authors of the paper, is available here.

Please feel welcome to join us for tea/coffee in Friars at 10am before the seminar!