15 October 2018

Economics working paper examining diversion ratio in hospital mergers

Estimating diversion ratios in hospital mergers
Competition and Markets Authority 15 October 2018
  • Understanding patient choice is vital in assessing the closeness of competition between hospitals. The standard technique used in the UK is to estimate substitution patterns based on historical GP referrals. 
  • This paper compares the results of the ‘GP referral’ methodology to a demand estimation approach and highlights similarities and where this approach is problematic.