The U.S. healthcare system is undergoing a period of substantial change, with hospitals purchasing many physician practices (“vertical integration"). In theory, this vertical integration could improve quality by promoting care coordination, but could also worsen it by impacting the care...

We investigate the role of physician agency and competition in determining health care supply and patient outcomes. A 2005 change to Medicare fees had a large, negative impact on physician profit margins for providing chemotherapy treatment. In response to these cuts, physicians increased their...