Discussion: “Involuntary Benchmarking and Quality Improvement: The Effect of Mandated Public Disclosure on Hospitals”

Abstract

This paper addresses an important empirical question: Does the mandated public disclosure of quality information cause predictable changes in managerial behavior? Evans et al. find that a new requirement for the disclosure of relative performance measures for Pennsylvania hospitals results in hospitals with higher quality (lower mortality rates) gaining market share. Anticipating this customer reaction, those hospitals with poorer quality levels, those facing more intense competition, and those small in size exhibit a greater improvement in their quality performance. However, the hospitals with higher mortality rates also exhibit the least improvement in productivity (as measured by length of stay).¹