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More physician concentration = higher prices

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Daniel R. Austin and Laurence C. Baker write in HealthAffairs about the connection between more concentration of physician services and higher prices. They say, among other things:

“Using county-level measures of the concentration of physician practices and county average prices, and statistically controlling for a range of other regional characteristics, we found that physician practice concentration and prices were significantly associated for twelve of the fifteen procedures we studied. For these procedures, counties with the highest average physician concentrations had prices 8–26 percent higher than prices in the lowest counties. We concluded that physician competition is frequently associated with prices. Policies that would influence physician practice organization should take this into consideration.

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