The impact of the Medicare Rural Hospital Flexibility Program on patient choice

Gautam Gowrisankaran, Claudio Lucarelli, Philipp Schmidt-Dengler, Robert Town

Research output: Contribution to journalArticle

7 Scopus citations

Abstract

This paper seeks to understand the impact of the Medicare Rural Hospital Flexibility (Flex) Program on rural resident hospital choice. The program created a new class of hospital, the Critical Access Hospital (CAH), which receives more generous reimbursement in return for limiting its beds and services. The program's goal is to maintain access to hospital care. Estimates from a patient choice model show that patient utility from visiting a hospital was negatively affected by conversion. While the lower bed capacity appears to play a minor role, the reduction in services results in a 28% drop in admission rates.

Original languageEnglish (US)
Pages (from-to)342-344
Number of pages3
JournalInternational Journal of Industrial Organization
Volume29
Issue number3
DOIs
StatePublished - May 2011

Keywords

  • Hospital choice
  • Medicare
  • Patient welfare

ASJC Scopus subject areas

  • Industrial relations
  • Aerospace Engineering
  • Economics and Econometrics
  • Economics, Econometrics and Finance (miscellaneous)
  • Strategy and Management
  • Industrial and Manufacturing Engineering

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