NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

HMO Penetration, Ownership Status, and the Rise of Hospital Advertising

Jason R. Barro, Michael Chu

NBER Working Paper No. 8899
Issued in April 2002
NBER Program(s):   HC

We examine the recent increase in hospital advertising expenditures. We first illustrate that the rise in hospital advertising has not been universal. Large, not-for-profit, teaching hospitals have, by far, experienced the largest increase in spending. Adjusting for size, for-profit hospitals over this period have actually decreased their marketing expenses. This increase in advertising spending is best explained by managed care penetration. There is a small and marginally significant relationship between increases in for-profit presence in hospital markets and an increase in advertising spending by the not-for-profit hospitals in those markets.

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Document Object Identifier (DOI): 10.3386/w8899

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