If You (Re)Build It, Will They Come? Evidence from California
Presented by Zach Levin
HSRP&A Doctoral Candidate
Division of Health Policy & Management
Hospitals in the United States spend nearly $30 billion annually on construction projects, but little is known about how these projects affect hospital admissions, hospital markets, and patient outcomes. Construction projects could improve quality of care and patient experience, but they could also increase healthcare spending and hospital market concentration.
Zach Levin creates a novel dataset of hospital construction projects in California from 2009-2015 and links these projects to hospital admission records and quality surveys. Using difference-in-difference estimation, he finds large effects of construction on patient volume, with a 14% increase in overall admissions after project opening and a 21% increase in admissions of patients with private insurance. He also examines measures of patient experience and find that patients are more likely to recommend a hospital after construction, as well as reporting their room to be quieter, though not cleaner.