Spatial effects in hospital expenditures: a district level analysis
2017
Geographical clusters in health expenditures are well documented and accounting for spatial interactions may
contribute to properly identify the factors affecting the use of health services the most. As for hospital care,
spillovers may derive from strategic behaviour of hospitals and from patients’ preferences that may induce
mobility across jurisdictions, as well as from geographically-concentrated risk factors, knowledge transfer and interactions between different layers of care. Our paper focuses on a largely overlooked potential source of
spillovers in hospital expenditure: the heterogeneity of primary care providers’ behaviour. To do so, we
analyse expenditures associated to avoidable hospitalisations separately from expenditures for highly complex
treatments, as the former are most likely affected by General Practitioners, while the latter are not. We use
administrative data for Italy’s Region Emilia Romagna between 2007 and 2010. Since neighbouring districts
may belong to different Local Health Authorities (LHAs), we employ a spatial contiguity matrix that allows to
investigate the effects of geographical and institutional proximity and use it to estimate Spatial Autoregressive
and Spatial Durbin Models.
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