Spillover Success in Healthcare

Ankita Srivastava
Surya B. Ayyalasomayajula
 Overview
• Introduction
• Motivation
• Gap
• Research question
• Theory
• Corporate Venture Capital
• Real Options
• Method
• Data
• Measures
• Estimation
• Results
• Discussion
• Limitations
• Next Steps
• Implications
The looming retirement crisis…
Investments in HIT and HIE
 Research Question

How do IT investments of geographically proximal hospitals effect the

revenue of the focal hospital ?
Lit Review: HIT and HIE Gaps
Network Externalities and HIE
 Hypothesis
Neighboring Hospital’s IT investments’ will have positive spillover
effects on the revenue of the focal hospital
 Data
• Data Source
• OHA Annual Survey

• Sample
• N= 621
• Data range: Financial Years 2012 to 2016
• 157 Hospitals;
 Main Measures
• Hospital Performance
• Revenue Generated for the Financial Year

• Excluding Discounts and Bad Debts

• Bed Utilization (To be studied)
 Controls
• Hospital Controls
• Size of the Hospital – No of licensed Beds
• Location – Rural / Urban
• Teaching Facility

• Dummy Variables for the Years

 Estimation

Revenueij = α1ITij + α2Spilloverij + α3Rurali + α4NoBedsij+

α5Year2012 + α6Year2013 + α7Year2014 +
α8Year2015 + εij

Wherei is the focal hospital

j is the financial year
εij is the error term
 Main Results
Variable Coeff. S.E. p>|t|
IT Spillover -9.78E-11 4.15E-11 0.019
No. of Licenced Beds 0.4661708 0.044619 0.000
Rural 0.0068518 0.0058863 0.245
IT Expenditure 0.0017472 0.0167059 0.917
Constant 0.044483 0.0112144 0.000
Fixed Effects Year
Hospitals 157
Observations 621
Teaching Facility Dropped due to collineraity
 Limitations

• Did not account for IT investment by the Group or parent Hospital

• Did not consider Hospital specific IT Development / Operational

resources

• Did not consider for the lag effect of IT Investment

 Next Steps

• Increase the sample size

• Include survey data of additional states

• Include data from a broader period

• Include the IT investment by the hospital system

 Potential Implications

• Demonstrated the negative impact of the geographically proximal

hospitals investment

• Positive impact of the size of licensed number of beds

Thank You