Does Better Quality Information Affect Hospital Choice in Germany? An Empirical Analysis

Abstract

This paper examines, whether well prepared report cards affect hospital choice within Germany. We report three main findings. First: hospitals, which publish their quality data voluntarily, extend their market shares after relative to before publishing the quality data compared to such hospitals that do not publish their quality data. Second: in the group of the publishing hospitals, hospitals with a higher than average quality increased their market shares after relative to before the adoption of the report card compared to hospitals with a lower than average quality. Third: hospitals with quality below average are basically chosen by patients living nearby and not by those with a higher travelling distance. Based on these finding decision makers in hospitals have strong incentives (i) to make quality information publicly available and (ii) to keep their quality scores high.