Patient Choice of Hospital and Quality of Care: Evidence from France

Abstract

Many countries promote competition among hospitals to improve quality, allowing patients to choose their providers. A pre-requisite for competition to work is that demand is elastic to quality. Exploiting a unique administrative database from France, we examine how patient choice is affected by an extensive range of quality measures that were available in the public domain. These include health outcomes, process measures of quality, patient satisfaction, hospital accreditation, as well as hospital ranking indicators provided by a popular newspaper. We estimate conditional logit models of hospital choice for all patients who underwent elective hip replacement in France in 2013-21. We find that demand responds the most to patient satisfaction and hospital rankings. It responds less to health outcomes, process measures of quality, and accreditation indicators. Overall, these findings highlight that patients respond the most to easily interpretable indicators.