Can We Measure Hospital Quality from Physicians' Choices?

47 Pages Posted: 17 Jun 2008

See all articles by Matilde Pinto Machado

Matilde Pinto Machado

Universidad Carlos III de Madrid - Department of Economics

Ricardo Mora

Universidad Carlos III de Madrid

Antonio Romero-Medina

Universidad Carlos III de Madrid - Department of Economics

Date Written: June 2008

Abstract

In this paper, we propose an alternative methodology for ranking hospitals based on the choices of Medical School graduates over hospital training vacancies. Our methodology is therefore a revealed preference approach. Our methodology for measuring relative hospital quality has the following desirable properties: a) robust to manipulation from hospital administrators; b) conditional on having enough observations, it allows for differences in quality across specialties within a hospital; c) inexpensive in terms of data requirements, d) not subject to selection bias from patients nor hospital screening of patients; and e) unlike other rankings based on experts' evaluations, it does not require physicians to provide a complete ranking of all hospitals. We apply our methodology to the Spanish case and find, among other results, the following: First, the probability of choosing the best hospital relative to the worst hospital is statistically significantly different from zero. Second, physicians value proximity and nearby hospitals are seen as more substitutable. Third, observable time-invariant city characteristics are unrelated to results. Finally, our estimates for physicians' hospital valuations are significantly correlated to more traditional hospital quality measures.

Keywords: Hospital Quality, Hospital Rankings, Nested Logit, Physicians' Labour Market, Revealed Preference

JEL Classification: I11, I12, J24, J44

Suggested Citation

Machado, Matilde P and Mora, Ricardo and Romero-Medina, Antonio, Can We Measure Hospital Quality from Physicians' Choices? (June 2008). CEPR Discussion Paper No. DP6850, Available at SSRN: https://ssrn.com/abstract=1146776

Matilde P Machado (Contact Author)

Universidad Carlos III de Madrid - Department of Economics ( email )

Calle Madrid 126
Getafe, 28903
Spain
+34 91 624 9571 (Phone)
+34 91 624 9875 (Fax)

Ricardo Mora

Universidad Carlos III de Madrid

Antonio Romero-Medina

Universidad Carlos III de Madrid - Department of Economics ( email )

Calle Madrid 126-128
Getafe, Madrid 28903
Spain

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