Short Term Health Effects of Outsourcing of Health Care in Finnish Municipalities
Vuorinen, Oskar (2022)
Vuorinen, Oskar
2022
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi-fe2022052238096
https://urn.fi/URN:NBN:fi-fe2022052238096
Tiivistelmä
While most of Finnish public health care is produced publicly by either municipalities or joint municipal authorities, a tenth of the municipalities have outsourced their health care services to private providers. Previous empirical literature suggests that outsourcing of health care has led to cost savings in Finnish municipalities. However, the effects on health and quality of health care remain unresearched. Assuming that changes in quality of health care are reflected in population health, this thesis studies the effects that outsourcing of health care in Finnish municipalities has had on the population health in the treated municipalities by measuring mortality and morbidity of those municipalities’ populations.
The effects of outsourcing to mortality and morbidity in the municipalities are studied using a difference-in-differences model with year and municipality-fixed effects. Nearest neighbor matching based on propensity score is used for each treated municipality to limit the municipalities in control group, using only the demographically comparable municipalities in estimating the treatment effect on mortality and morbidity in municipalities that have outsourced their health care services. The difference-in-differences model is also applied separately to each treated municipality and their nearest neighbor to capture the treated municipalities’ individual treatment effects. The results suggest a negative treatment effect on mortality the first year after the initiation of outsourcing and a delayed treatment effect on mortality the second year after the initiation of outsourcing. Furthermore, the results suggest a slight negative treatment effect on morbidity the first year after the initiation of outsourcing. The results imply that outsourcing has led to an improved quality of health care in relatively small Finnish municipalities. The increase in quality may either result from the private providers’ deliberate quality-increasing efforts due to quality incentives, or from other improvements in efficiency as a result of the responsibility of organizing health care transferring to the private providers.
The effects of outsourcing to mortality and morbidity in the municipalities are studied using a difference-in-differences model with year and municipality-fixed effects. Nearest neighbor matching based on propensity score is used for each treated municipality to limit the municipalities in control group, using only the demographically comparable municipalities in estimating the treatment effect on mortality and morbidity in municipalities that have outsourced their health care services. The difference-in-differences model is also applied separately to each treated municipality and their nearest neighbor to capture the treated municipalities’ individual treatment effects. The results suggest a negative treatment effect on mortality the first year after the initiation of outsourcing and a delayed treatment effect on mortality the second year after the initiation of outsourcing. Furthermore, the results suggest a slight negative treatment effect on morbidity the first year after the initiation of outsourcing. The results imply that outsourcing has led to an improved quality of health care in relatively small Finnish municipalities. The increase in quality may either result from the private providers’ deliberate quality-increasing efforts due to quality incentives, or from other improvements in efficiency as a result of the responsibility of organizing health care transferring to the private providers.