The effect of hospital/physician integration on hospital choice

J Health Econ. 2016 Dec:50:1-8. doi: 10.1016/j.jhealeco.2016.08.006. Epub 2016 Sep 3.


In this paper, we estimate how hospital ownership of physicians' practices affects their patients' hospital choices. We match data on the hospital admissions of Medicare beneficiaries, including the identity of their physician, with data on the identity of the owner of their physician's practice. We find that a hospital's ownership of a physician dramatically increases the probability that the physician's patients will choose the owning hospital. We also find that patients are more likely to choose a high-cost, low-quality hospital when their physician is owned by that hospital.

Keywords: Cost and quality of care; Health economics; Hospital choice; Hospital integration.

MeSH terms

  • Choice Behavior
  • Hospitals
  • Humans
  • Medicare*
  • Physician-Patient Relations*
  • Physicians*
  • United States