PUBLIC RELEASE DATE:

21-Oct-2014

Contact: Michelle Brandt mbrandt@stanford.edu 650-723-0272 Stanford University Medical Center @sumedicine

Medical practices in less competitive health-care markets charge more for services, according to a study conducted by researchers at the Stanford University School of Medicine and the National Bureau of Economic Research.

The study, based on U.S. health-care data from 2010, provides important new information about the effects of competition on prices for office visits paid by preferred provider organizations, known more commonly as PPOs. PPOs are the most common type of health insurance plan held by privately insured people in the United States.

The study will be published Oct. 22 in the Journal of the American Medical Association.

"The research comes out of trying to understand some dramatic changes that have occurred in the health-care system over a couple of decades," said the study's lead author, Laurence Baker, PhD, professor of health research and policy at Stanford.

One striking change is the shift from practices with one or two doctors toward larger, more complex organizations with many physicians. One important impact of this can be reductions in the amount of competition among physician practices. The study sought to understand how variation in the amount of competition within a region affects the amounts doctors are paid, an important consideration when developing health policy.

"This has always been an important issue, and now it's even more important as policy moves us more and more toward larger practices," said study co-author Kate Bundorf, PhD, associate professor of health and research policy.

The pluses and minuses

Link:

Competition keeps health-care costs low, Stanford researchers find