TY - JOUR AU - Gaynor,Martin AU - Moreno-Serra,Rodrigo AU - Propper,Carol TI - Death by Market Power: Reform, Competition and Patient Outcomes in the National Health Service JF - National Bureau of Economic Research Working Paper Series VL - No. 16164 PY - 2010 Y2 - July 2010 UR - http://www.nber.org/papers/w16164 L1 - http://www.nber.org/papers/w16164.pdf N1 - Author contact info: Martin Gaynor Heinz College Carnegie Mellon University 4800 Forbes Avenue, Room 3008 Pittsburgh, PA 15213-3890 Tel: 412/268-7933 Fax: 412/268-5338 E-Mail: mgaynor@cmu.edu Rodrigo Moreno-Serra Imperial College Business School Imperial College London, South Kensington Campus London SW7 2AZ, United Kingdom E-Mail: r.moreno-serra@imperial.ac.uk Carol Propper Imperial College Business School South Kensington Campus London SW7 2AZ, United Kingdom E-Mail: carol.propper@bristol.ac.uk AB - The effect of competition on the quality of health care remains a contested issue. Most empirical estimates rely on inference from non experimental data. In contrast, this paper exploits a pro-competitive policy reform to provide estimates of the impact of competition on hospital outcomes. The English government introduced a policy in 2006 to promote competition between hospitals. Patients were given choice of location for hospital care and provided information on the quality and timeliness of care. Prices, previously negotiated between buyer and seller, were set centrally under a DRG type system. Using this policy to implement a difference-in-differences research design we estimate the impact of the introduction of competition on not only clinical outcomes but also productivity and expenditure. Our data set is large, containing information on approximately 68,000 discharges per year per hospital from 162 hospitals. We find that the effect of competition is to save lives without raising costs. Patients discharged from hospitals located in markets where competition was more feasible were less likely to die, had shorter length of stay and were treated at the same cost. ER -