Rural Healthcare Access and Supply Constraints: a Causal Analysis

Melo, V., Sigaud, L., Neilson, E., & Bjoerkheim, M. (2024). Rural healthcare access and supply constraints: A causal analysis. Southern Economic Journal, 1–19. https://doi.org/10.1002/soej.12686

27 Pages Posted: 12 Jun 2024

See all articles by Vitor Melo

Vitor Melo

Clemson University; Mercatus Center; Initiative on Enabling Choice and Competition at the University of Chicago

Liam Sigaud

George Mason University - Mercatus Center

Elijah Neilson

Southern Utah University

Markus Bjoerkheim

Mercatus Center - George Mason University

Date Written: April 9, 2024

Abstract

Certificate-of-need (CON) laws require that healthcare providers receive approval from a state board before offering additional services in a given community. Proponents of CON laws claim that these laws are needed to prevent the oversupply of healthcare services in urban areas and to increase access in rural areas, which are predominantly underserved. Yet, the policy could lower rural access if used by incumbents to limit entry from competitors. We explore the repeal of these regulations in five U.S. states to offer the first estimate of the causal effects of CON laws on rural and urban healthcare access. We find that repealing CON laws causes a substantial increase in hospitals in both rural and urban areas. We also find that the repeal leads to fewer beds and smaller hospitals on average, suggesting an increase in entry and competition in both rural and urban areas.

Keywords: Healthcare Access, Rural Areas, Regulation, Certificate-of-need

JEL Classification: I11, I18, L51

Suggested Citation

Melo, Vitor and Sigaud, Liam and Neilson, Elijah and Bjoerkheim, Markus, Rural Healthcare Access and Supply Constraints: a Causal Analysis (April 9, 2024). Melo, V., Sigaud, L., Neilson, E., & Bjoerkheim, M. (2024). Rural healthcare access and supply constraints: A causal analysis. Southern Economic Journal, 1–19. https://doi.org/10.1002/soej.12686, Available at SSRN: https://ssrn.com/abstract=4826605 or http://dx.doi.org/10.2139/ssrn.4826605

Vitor Melo (Contact Author)

Clemson University ( email )

Clemson, SC 29631
United States

Mercatus Center ( email )

3434 Washington Blvd., 4th Floor
Arlington, VA 22201
United States

Initiative on Enabling Choice and Competition at the University of Chicago ( email )

1101 East 58th Street
Chicago, IL 60637
United States

Liam Sigaud

George Mason University - Mercatus Center ( email )

Elijah Neilson

Southern Utah University ( email )

351 West Center Street
Cedar City, UT 84720
United States

Markus Bjoerkheim

Mercatus Center - George Mason University ( email )

3434 Washington Blvd., 4th Floor
Arlington, VA 22201
United States

HOME PAGE: http://www.mbjoerkheim.com

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