The effects of hospital concentration on the length of stay and inpatient mortality in Germany

Study objective The article examines the effects of hospital concentration on average length of stay and inpatient mortality in Germany. Methodology Regression analysis based on regional panel data, taking into account (unobserved) individual heterogeneity and trend in modeling. In addition, to obtain evidence on the direction of the relationship, the instrumental variable approach is applied and Granger causality is tested. Results Increasing hospital concentration in Germany is associated with a negative and statistically significant effect on average length of stay. The fewer hospitals a region has, the lower (ceteris paribus) the length of stay in the hospital units. At the same time, the number of hospitals has no statistically significant effect on patient mortality. The relationship between hospital concentration and length of stay can thus be interpreted as a positive quality effect.