Can amputation save the hospital? The impact of the Medicare Rural Flexibility Program on demand and welfare
MetadataShow full item record
PublisherELSEVIER SCIENCE BV
CitationGowrisankaran, G., Lucarelli, C., Schmidt-Dengler, P., & Town, R. (2018). Can amputation save the hospital? The impact of the Medicare Rural Flexibility Program on demand and welfare. Journal of health economics, 58, 110-122, https://doi.org/10.1016/j.jhealeco.2018.01.004
JournalJOURNAL OF HEALTH ECONOMICS
Rights© 2018 Elsevier B.V. All rights reserved.
Collection InformationThis item from the UA Faculty Publications collection is made available by the University of Arizona with support from the University of Arizona Libraries. If you have questions, please contact us at firstname.lastname@example.org.
AbstractThis paper seeks to understand the impact of the Medicare Rural Hospital Flexibility (Flex) Program on hospital choice and consumer welfare for rural residents. The Flex Program created a new class of hospital, the Critical Access Hospital (CAH), which receives more generous Medicare reimbursements in return for limits on capacity and length of stay. We find that conversion to CAH status resulted in a 4.7 percent drop in inpatient admissions to participating hospitals, almost all of which was driven by factors other than capacity constraints. The Flex Program increased consumer welfare if it prevented the exit of at least 6.5 percent of randomly selected converting hospitals. (C) 2018 Elsevier B.V. All rights reserved.
Note24 month embargo; published online: 7 February 2018
VersionFinal accepted manuscript
SponsorsAgency for Healthcare Research and Quality (AHRQ) [1R01HS018424-01A1]; Fondecyt 
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