HOW DO HOSPITALS RESPOND TO PRICE CHANGES?EVIDENCE FROM NORWAY

Jurgita Janueleviciute (), Jan Erik Askildsen, Oddvar Kaarboe (), Luigi Siciliani and Matt Sutton ()
Additional contact information
Jurgita Janueleviciute: Department of Economics, University of Bergen, Postal: The university of Bergen, Department of Economics, Fosswincelsgate 14, 5007 Bergen, http://www.uib.no/econ
Matt Sutton: Centre for Health Economics, University of Manchester, Postal: Centre for Health Economics, Institute of Population Health, University of Manchester, Room 1.304 University Place, Oxford Road, Manchester M13 9PL, http://www.manchester.ac.uk/

No 15/12, Working Papers in Economics from University of Bergen, Department of Economics

Abstract: Many publicly funded health systems use prospective activity-based financing to increase hospital production and efficiency. The aim of this study is to investigate whether price changes for different treatments affect the mix of activity provided by hospitals. We exploit variations in prices created by changes in the national average treatment cost per DRG offered to Norwegian hospitals over a period of five years (2003-2007). We use data from the Norwegian Patient Register, containing individual-level information on age, gender, type of treatment, diagnosis, number of co-morbidities and the national average treatment costs per DRG. To examine the changes in activity within the DRGs over time, fixed-effect models are applied. The results suggest that a ten-percent increase in price leads to a rise of one percent in the number of patients treated. This increase is mainly due to more admission of emergency patients, rather than to increases in elective activity.

Keywords: Hospitals; DRGs; prices; activity (search for similar items in EconPapers)
JEL-codes: H42 I11 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2013-03-08
New Economics Papers: this item is included in nep-eur, nep-hea and nep-hme
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Citations: View citations in EconPapers (11)

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Related works:
Journal Article: How do Hospitals Respond to Price Changes? Evidence from Norway (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:bergec:2012_015

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