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COMPETITION AND CROWDING OUT IN THE MARKET FOR OUTPATIENT SUBSTANCE ABUSE TREATMENT*
27
Citations
41
References
2013
Year
Substance UseDrug PolicyDrug TreatmentMarket DesignU.s. MarketsSubstance Use TreatmentAddiction MedicineNew MethodsPublic HealthInsurance RegulationsAntitrust EnforcementHealth SciencesPublic PolicyEconomicsHealth PolicyAddiction TreatmentHealth InsuranceTreatment BarriersEquilibrium Market StructureSubstance AbuseHealth EconomicsAddictionHealth Services CompetitionAddiction Health Service ResearchSubstance AddictionPublic Health Programs
U.S. markets for outpatient substance abuse treatment (OSAT) include for‐profit, nonprofit, and public clinics. We study OSAT provision using new methods on equilibrium market structure in differentiated product markets. This allows us to describe clinics as heterogeneous in their objectives, their responses to exogenous market characteristics, and their responses to one another. Consistent with crowding out of private treatment, we find that markets with public clinics are less likely to have private clinics. In markets with low insurance coverage, low incomes, or high shares of nonwhite addicts, however, public clinics are relatively likely to be the sole willing providers of OSAT.
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