Change in avoidable hospitalizations for low-income elders following quasi-market reform in primary care – Evidence from a natural experiment in Sweden

Abstract

Quasi-market reforms have been increasingly implemented in tax-funded health care, but their effects in terms of equity, quality and socioeconomic differentials in quality remain sparsely studied.We create a natural experiment setup exploiting the differential timing of a set of quasi-market reforms – including patient choice, free establishment of providers and changes in provider remuneration –, implemented in primary care in the two largest Swedish regions (Stockholm and Västra Götaland) in 2008–2009. Using a database with individual level data from 2005 to 2009, we construct a difference-in-difference-in-differences model that compares pre to post reform changes in avoidable hospitalizations (AHs) for low-income elders and a matched comparison group, in the region exposed to, versus unexposed to, reform (total N ∼ 200 000).The results show that for low-income elders – a group dominated by older women – reform led to higher AH rates, i.e., worse primary health care quality, than what would have been the case in absence of reform. Specifically, low-income elders exposed to reform missed out on improvements in AHs seen simultaneously in the unexposed region. At the same time, the reform had on average no effect for comparable, non-low-income, peers. The fact that this pattern was specific for avoidable hospitalizations – judged as amenable to interventions in primary care –, but not present for total hospitalizations, supports that it was driven by reform implementation rather than other factors.The study contributes with high-quality empirical evidence to a policy relevant but sparsely researched area and highlights the necessity to consider differential effects of organizational changes across socioeconomic groups.