Patient selection in the presence of regulatory oversight based on healthcare report cards of providers: the case of organ transplantation

Many healthcare report cards provide information to consumers but do not represent a constraint on the behavior of healthcare providers. This is not the case with the report cards utilized in kidney transplantation. These report cards became more salient and binding, with additional oversight, in 2007 under the Centers for Medicare and Medicaid Services Conditions of Participation. This research investigates whether the additional oversight based on report card outcomes influences patient selection via waiting-list registrations at transplant centers that meet regulatory standards. Using data from a national registry of kidney transplant candidates from 2003 through 2010, we apply a before-and-after estimation strategy that isolates the impact of a binding report card. A sorting equilibrium model is employed to account for center-level heterogeneity and the presence of congestion/agglomeration effects and the results are compared to a conditional logit specification. Our results indicate that patient waiting-list registrations change in response to the quality information similarly on average if there is additional regulation or not. We also find evidence of congestion effects when spatial choice sets are smaller: new patient registrations are less likely to occur at a center with a long waiting list when fewer options are available.