We use data across states to examine the relation between HMO enrollment and medical spending. We find that increased managed care enrollment significantly reduces hospital cost growth. While some of this effect is offset by increased spending on physicians, we generally find a significant...

Innovation is part idea generation and part development. We build a model of "innovating-by-doing," whereby ideas come to practitioners. Successful innovation requires that practitioners' ideas be developed through costly effort. Our model nests existing theories of laboratory research and...

We use data across states to examine the relation between HMO enrollment and medical spending. We find that increased managed care enrollment significantly reduces hospital cost growth. While some of this effect is offset by increased spending on physicians, we generally find a significant...

Rationale: A prospective reimbursement system based on Diagnosis Related Groups (DRGs) has been recently introduced in several European countries for acute inpatient treatment, e.g. in Germany in 2003. To enable the application of new health technologies a special reimbursement process has been...