Competition and prospective payment have been widely used to control health care costs but may together provide incentives to selectively reduce expenditures on high-cost relative to low-cost users. We use patient discharge and hospital financial data from California to examine the effects of...

Competition and prospective payment have been widely used to control health care costs but may together provide incentives to selectively reduce expenditures on high-cost relative to low-cost users. We use patient discharge and hospital financial data from California to examine the effects of...