The welfare effects of mergers in the hospital industry
A broader consideration of social welfare in the analysis of the impact of hospital consolidation reveals gains in welfare benefits despite a predicted decline in consumer surplus resulting from the establishment of a monopoly. The existence of a moral hazard, described as a probable over-consumption of quality that is unique to the healthcare industry, is mitigated by the effect of a merger that tends to eliminate quality competition between hospitals.
Publication Name: Journal of Economics and Business
Survivorship in the US hospital services industry
Research into the impact of new state and federal laws and increased price competition on the size distribution of hospitals is presented. It appears that increased price sensitivity since the early 1980s has had an impact on the size distribution of hospitals.
Publication Name: Managerial & Decision Economics
Hospital management companies, American Medical International (AMI) and Lifemark Corporation, are merging. Changes in the United States Medicare program make this possible. The merger can utilize economics of scale.
Publication Name: Economist
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