How Does Competition Impact Quality of Care? A Case Study of the U.S. Dialysis Industry

We examine whether and to what extent consolidation in the largely for-profit U.S. dialysis industry has affected patient outcomes, clinical practices, and prices charged to the privately-insured. We make use of detailed facility data for the period 2000-2009, during which the market share of the two industry leaders increased from just over one-third to nearly two-thirds. We exploit the differential impact of two large national acquisitions on local market concentration to estimate the causal effect of concentration on a broad set of measures, including mortality rates, dialysis adequacy, staffing ratios, and price per treatment. We find no statistically or economically significant effects of competition on any outcome or practice measure. Preliminary analysis suggests consolidation may have led to higher private prices.