Abstract
Little is known about how prospective provider payment affects the provision of services led by unpredictable demand. We investigate hospital responses to a 32% increase in price for two treatments in emergency departments in England in April 2011 using data on 11,532,304 attendances (79 hospitals) between 2009/10 and 2013/14. We compare changes in the volumes of these two treatments to a treatment not attracting additional reimbursement using a difference-in-differences framework. Additional reimbursement led to 76% and 152% increases in the volumes of the two incentivised treatments. Hospitals received an additional £64.4M between April 2011 and March 2014 for providing these treatments, of which 40% (£30.0M) was attributable to the unanticipated hospital response to the price increase. We use time in treatment to distinguish real increases in treatment from reductions in under-coding or increases in up-coding. The association between the recorded receipt of these treatments and time spent in treatment was the same before and after the price increase and there was no association between hospital-specific increases in recorded treatment volumes and changes in treatment times. The persistence of the treatment time increment suggests the increase in recorded treatment was a real increase in provision of treatments.
Original language | English |
---|---|
Journal | Health Economics |
Early online date | 24 Jun 2019 |
DOIs | |
Publication status | Published - 2019 |
Keywords
- hospital behaviour
- payment systems
- hospital reimbursement
- emergency department