We study the relationship between physician-hospital integration and its relation to monitoring IT utilization. We develop a theoretical model in which monitoring IT may complement or substitute for integration and test these relationships using a novel data source. Physician labor market heterogeneity identifies the empirical model. We find that monitoring IT utilization is increasing in integration, implying that expanded firm boundaries complement monitoring IT adoption. We argue that the relationship between monitoring IT and firm boundaries depends upon the contractibility of the monitored information.
Bibliographical noteFunding Information:
We gratefully acknowledge the Health Information Management Systems Society (HIMSS) for use of their data. Additionally, The Robert Wood Johnson Foundation's Changes in Health Financing and Organization (Grant #64845 ) provided funding for this research. We express our appreciation to Bryan Dowd, Lorin Hitt, Joe Terza, Anandasivam Gopal, Steve Parente, and Jim Burgess for their suggestions and comments. We also thank participants in our 2007 Workshop on Information Systems Economics and International Health Economics Association sessions as well as our anonymous reviewers. Finally, we thank the Minnesota Supercomputing Institute for their invaluable support.
- Firm boundaries
- Health information technology
- Nonprofit institutions
- Vertical integration