The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery

15 Pages Posted: 21 Jul 2006 Last revised: 31 Aug 2010

See all articles by David M. Cutler

David M. Cutler

Harvard University - Department of Economics; National Bureau of Economic Research (NBER); Harvard University - Harvard Kennedy School (HKS)

Robert S. Huckman

Harvard Business School; National Bureau of Economic Research (NBER)

Mary Beth Landrum

Harvard Medical School

Date Written: May 2004

Abstract

During the past two decades, several public and private organizations have initiated programs to report publicly on the quality of medical care provided by specific hospitals and physicians. These programs have sparked broad debate among economists and policy makers concerning whether, and to what extent, they have improved or harmed medical productivity. We take advantage of a cross-sectional time series of different hospitals to address two fundamental questions about quality reporting. First, we examine whether report cards affect the distribution of patients across hospitals. Second, we determine whether report cards lead to improved medical quality among hospitals identified as particularly bad or good performers. Our data are from the longest-standing effort to measure and report health care quality the Cardiac Surgery Reporting System (CSRS) in New York State. Using data for 1991 through 1999, we find that CSRS affected both the volume of cases and future quality at hospitals identified as poor performers. Poor performing hospitals lost relatively healthy patients to competing facilities and experienced subsequent improvements in their performance as measured by risk-adjusted mortality.

Suggested Citation

Cutler, David M. and Huckman, Robert S. and Landrum, Mary Beth, The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery (May 2004). NBER Working Paper No. w10489. Available at SSRN: https://ssrn.com/abstract=546286

David M. Cutler (Contact Author)

Harvard University - Department of Economics ( email )

Littauer Center, Room 315A
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National Bureau of Economic Research (NBER) ( email )

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617-868-3900 (Phone)
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Harvard University - Harvard Kennedy School (HKS) ( email )

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Robert S. Huckman

Harvard Business School ( email )

Technology & Operations Management
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United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Mary Beth Landrum

Harvard Medical School ( email )

Department of Health Care Policy
Boston, MA 02115
United States

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