Hospital Compare and Hospital Choice: Public Reporting and Hospital Choice by Hip Replacement Patients in Texas

Abstract

The Centers for Medicare & Medicaid Services publicizes comparative performance data on Hospital Compare, a website maintained to support consumer decision making. Given the agency’s goal, this study investigates the relationship between public reporting and hospital choices of hip replacement patients in Texas. Estimating individual-level valuations of provider characteristics allowing for heterogeneity across patients, we find consumer selections and hospitals’ displayed performance vary together in time. Comparing associations involving public reporting with those associated with more readily observable hospital attributes, we conclude relationships coinciding with release of comparative performance data are modest, but not inconsequential. Our use of an empirical strategy novel for evaluation of public reporting has methodological implications, while the study’s affirmative result is of potential interest to policy makers and administrators.