Sources of Geographic Variation in Health Care: Evidence from Patient Migration

54 Pages Posted: 29 Dec 2014 Last revised: 6 Jan 2015

See all articles by Amy Finkelstein

Amy Finkelstein

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER)

Matthew Gentzkow

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)

Heidi L. Williams

MIT Department of Economics; National Bureau of Economic Research (NBER)

Date Written: December 2014

Abstract

We study the drivers of geographic variation in US health care utilization, using an empirical strategy that exploits migration of Medicare patients to separate the role of demand and supply factors. Our approach allows us to account for demand differences driven by both observable and unobservable patient characteristics. We find that 40-50 percent of geographic variation in utilization is attributable to patient demand, with the remainder due to place-specific supply factors. Demand variation does not appear to result from differences in past experiences, and is explained to a significant degree by differences in patient health.

Suggested Citation

Finkelstein, Amy and Gentzkow, Matthew Aaron and Williams, Heidi L., Sources of Geographic Variation in Health Care: Evidence from Patient Migration (December 2014). NBER Working Paper No. w20789. Available at SSRN: https://ssrn.com/abstract=2543641

Amy Finkelstein (Contact Author)

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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National Bureau of Economic Research (NBER) ( email )

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Matthew Aaron Gentzkow

University of Chicago - Booth School of Business ( email )

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National Bureau of Economic Research (NBER)

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Heidi L. Williams

MIT Department of Economics ( email )

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Cambridge, MA 02142
United States
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(617) 253-1330 (Fax)

HOME PAGE: http://econ-www.mit.edu/faculty/heidiw

National Bureau of Economic Research (NBER)

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United States

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