The European Journal of Health Economics

, Volume 20, Issue 1, pp 163–174 | Cite as

Trends and regional variation in rates of orthopaedic surgery in Germany: the impact of competition

  • Natalie BaierEmail author
  • Lisa-Marie Sax
  • Leonie Sundmacher
Original Paper


Competition in hospital services has been fostered in an increasing number of OECD countries with the goal that hospitals improve quality and/or efficiency. With the same intention competition has been promoted in Germany when introducing a system of prospective payments based on diagnosis-related groups (DRGs) in 2003. Beyond its intended effects, however, the reform led to a substantial increase in hospital activity, particularly for orthopaedic surgery. To shed more light on these developments, this paper analyses the relationship between the rates of certain orthopaedic surgical procedures and hospital competition across and within each of Germany’s 402 districts. We measured competition with the Herfindahl–Hirschman Index (HHI) based on market shares for hip replacements, knee replacements and spine surgeries. Using spatial panel regression, which allows for spatial dependency and unobserved individual heterogeneity, we found that the rate of hip and knee replacements rose as market concentration increased. A potential explanation might be that hospitals specialize in these particular procedures.


Orthopaedic surgery Regional variation Spatial panel regression Hospital competition Germany 

JEL Classification

I11 I18 C23 



This project was funded by the German Federal Ministry of Education and Research (BMBF, grant number 01EH1202A).

Compliance with ethical standards

Conflict of interest

The authors declare that they have no conflict of interest.


An ethic approval was not required for this study.

Supplementary material

10198_2018_990_MOESM1_ESM.docx (28 kb)
Supplementary material 1 (DOCX 27 KB)


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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Department of Health Care Management, Berlin Centre for Health Economics Research (BerlinHECOR)Technische Universität BerlinBerlinGermany
  2. 2.City University LondonLondonUK
  3. 3.Department of Health Services ManagementLudwig-Maximilians-Universität MünchenMunichGermany

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