Question #3 : [RStudio Users and Excel Users]

The dataset provides Herfindahl–Hirschman Index for health insurance market, please use the herf_ins variable and answer the following questions:

For this exercise you do not need to compute the HHI, but if you have any questions, please do not hesitate to ask me, but try to learn more about this you will need that to report your findings.

Please remember for the class exercise you used the herf_cat as a hospital Herfindahl index. For this question make sure to use herf_ins as Herfindahl index for insurance market.

Use the final exam dataset and then answer the following questions:

1) In a short paragraph explain the Herfindahl index you can use the reference provided in the class exercise or any other citation.

2) Compare the following information between hospitals located in high, moderate and low competitive health insurance markets? 

o 2.1. What are the main significant differences between hospitals in different markets? (use Anova test)

o 2.2. What is the impact of being in high-competitive health insurance market on hospital revenues and cost? 

o 2.3. Do you think being in high-competitive market has positive impact on net hospital benefits?  

o 2.4. What about the number of Medicare and Medicaid discharge? Do you think hospitals in higher completive market more likely to accept more Medicare and Medicaid patients? 

o 2.5. What is the impact of other variables? 

(Note: to answer to the last question, please compute the ratio-Medicare-discharge and ratio-Medicaid-discharge first and then run 2 ttest) high vs. moderate and high vs. low competitive market), please support your findings with box-plot). 

Table 3. Comparing hospital characteristics and market