Format

Send to

Choose Destination
See comment in PubMed Commons below
J Health Econ. 2009 Mar;28(2):350-60. doi: 10.1016/j.jhealeco.2008.11.001. Epub 2008 Nov 13.

Managed care's price bargaining with hospitals.

Author information

1
University of Southern California and RAND Corporation, Los Angeles, CA 90089, United States. vivianwu@usc.edu

Abstract

Research has shown that managed care (MC) slowed the rate of growth in health care spending in the 1990s, primarily via lower unit prices paid. However, the mechanism of MC's price bargaining has not been well studied. This article uses a unique panel dataset with actual hospital prices in Massachusetts between 1994 and 2000 to examine the sources of MC's bargaining power. I find two significant determinants of price discounts. First, plans with large memberships are able to extract volume discounts across hospitals. Second, health plans that are more successful at channeling patients can extract greater discounts. Patient channeling can add to the volume discount that plans negotiate.

PMID:
19108922
DOI:
10.1016/j.jhealeco.2008.11.001
[Indexed for MEDLINE]
PubMed Commons home

PubMed Commons

0 comments
How to join PubMed Commons

    Supplemental Content

    Full text links

    Icon for Elsevier Science
    Loading ...
    Support Center