TY  - JOUR
AU  - Gaynor,Martin
AU  - Propper,Carol
AU  - Seiler,Stephan
TI  - Free to Choose? Reform and Demand Response in the English National Health Service
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 18574
PY  - 2012
Y2  - November 2012
UR  - http://www.nber.org/papers/w18574
L1  - http://www.nber.org/papers/w18574.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

Carol Propper
Imperial College Business School
South Kensington Campus
London SW7 2AZ, United Kingdom
E-Mail: carol.propper@bristol.ac.uk

Stephan Seiler
Stanford GSB
Knight Management Center
655 Knight Way
Stanford, CA 94305
E-Mail: sseiler@stanford.edu
AB  - The impacts of choice in public services are controversial.  We exploit a reform in the English National Health Service to assess the impact of relaxing constraints on patient choice. We estimate a demand model to evaluate whether increased choice increased demand elasticity faced by hospitals with regard to clinical quality and waiting time for an important surgical procedure. We find substantial impacts of the removal of restrictions.  Patients became more responsive to clinical quality. Sicker patients and better informed patients were more affected.  We leverage our model to calculate potential benefits. We find increased demand responsiveness led to a significant reduction in mortality and an increase in patient welfare. The elasticity of demand faced by hospitals increased post-reform, giving hospitals potentially large incentives to improve their quality of care and find suggestive evidence that hospitals responded strongly to the enhanced incentives due to increased demand elasticity. The results suggests greater choice can enhance quality.
ER  -