Demand for and regulation of cardiac services

Abstract

Centralization of cardiac services can increase hospital surgery volumes and decrease access for patients. This study estimates the effects of changes in the regulation of cardiac services on treatments, mortality, and utility. Demand for surgery services by heart attack victims who form expectations of the need for and productivity of surgery in their choice of hospital and treatment is estimated. The results indicate that mortality and ex ante utility are insensitive to moderate changes in policy: Changes in surgery volume and travel costs offset one another. Despite similar health outcomes, the competing policies have different implications for taxpayers.