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ToolsDavies, Charlotte and Davies, Stephen (2021) Assessing competition in the hip implant industry in the light of recent policy guidance. Social Science & Medicine, 287. ISSN 0277-9536
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Abstract
NHS procurement is a highly topical area, attracting a great deal of recent policy focus. The pivotal report by Lord Carter of Coles (2016) highlighted unwarranted variation, estimating it to be worth approximately £5bn in efficiency savings. In relation to hip replacement surgery, recent procurement policy guidance has recommended the use of cemented hip implants for all patients aged 68 years and over in England and Wales. Previous work established that the hip implant supplying market was very concentrated, with only a few large suppliers, especially for cemented implants. The advocated major shift towards cemented implants would almost certainly increase further the market share of the dominant manufacturer of cemented sector thus raising potential competition and welfare issues. We carry out a market study to establish whether there might be a potential competition concern, using data from the National Joint Registry (2005–2018, 37 suppliers, nearly 700 models). We first establish the structure of the industry with a specific focus on seller concentration. Secondly we evaluate the dynamics underlying concentration in the market, assessing the innovative performance of the sector using a novel statistical analysis of the dynamics of market shares. We then look to three comparable but alternative markets for similarities or differences to the THR implant industry. We find a high and increasingly concentrated oligopolistic and static market structure, largely devoid of dynamics and with no real sign of innovation. These findings are further emphasized when compared with the three close alternative markets. Although this stability could just be a mature market where technical advances have already taken place, our findings highlight the potential welfare and policy implications of concentrating on cemented fixation. Given the current emphasis on efficiency in procurement, it is essential that there should also be scrutiny of the firms dealing with public procurement.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | competition,concentration,implant,innovation,nhs,procurement,total hip replacement surgery,health(social science),history and philosophy of science ,/dk/atira/pure/subjectarea/asjc/3300/3306 |
| Faculty \ School: | Faculty of Medicine and Health Sciences > Norwich Medical School Faculty of Social Sciences > School of Economics |
| UEA Research Groups: | Faculty of Medicine and Health Sciences > Research Groups > Public Health and Health Services Research (former - to 2023) Faculty of Medicine and Health Sciences > Research Groups > Health Economics Faculty of Social Sciences > Research Centres > Centre for Competition Policy Faculty of Social Sciences > Research Groups > Industrial Economics |
| Related URLs: | |
| Depositing User: | LivePure Connector |
| Date Deposited: | 26 May 2021 00:11 |
| Last Modified: | 14 May 2023 00:57 |
| URI: | https://ueaeprints.uea.ac.uk/id/eprint/80101 |
| DOI: | 10.1016/j.socscimed.2021.114055 |
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