Productivity in U.S. Healthcare

Atul Gupta, Health Care Management, The Wharton School; Benjamin Chartock, Bentley University

Abstract: Improving productivity of the US healthcare system is a policy goal of first-order importance since we spend twice as much as comparable countries without better outcomes. One way to do so is to reduce heterogeneity across firms. Larger firms may deliver better outcomes at lower costs for various reasons, for example, better managerial and clinical staff, better implementation of care protocols, more innovative protocols, more efficient use of capital and labor, etc. They may also benefit from scale economies of scope by applying lessons from adjacent sectors. However, little is known currently about the effect of scale and scope on productivity and innovation in healthcare. We propose using unique and hitherto untapped Census economic files on the healthcare sector to answer these questions. We anticipate this project will deliver insights on how different organization structures can improve innovation and productivity in healthcare delivery.