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By | October 2012
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ORGANIZATIONAL FRAGMENTATION AND CARE QUALITY
IN THE US HEALTH CARE SYSTEM

Randal Cebul
School of Medicine and Center for Health Care Research and Policy Case Western Reserve University

James B. Rebitzer
Department of Economics, Weatherhead School and
Center for Health Care Research and Policy
Case Western Reserve University,
NBER, The Levy Institute, and IZA

Lowell J. Taylor
H. John Heinz III School of Public Policy and Management
Carnegie Mellon University

Mark Votruba
Department of Economics, Weatherhead School
School of Medicine and Center for Health Care Research and Policy Case Western Reserve University

12/4/2007

Please send correspondence to
James B. Rebitzer
Room 274 Peter B. Lewis Building
Case Western Reserve University
11119 Bellflower Ave
Cleveland, OH. 44106
Office phone: 216 368 5537
Email: james.rebitzer@case.edu

Abstract
From an organizational perspective, the US health care system is highly fragmented. Critical tasks in the financing and provision of health care are distributed across a variety of distinct, often competing, entities each with its own objectives, obligations and capabilities. The market mechanisms, contractual arrangements, governance structures and information technologies that enable coordination elsewhere in the economy often function poorly in the health care setting. As a result, organizational fragmentation is a serious and persistent impediment to improving health care quality. We illustrate our argument with examples taken from the insurance and the hospital industries, and discuss possible responses to the problems that arise as a consequence of organizational fragmentation.

Introduction
From an organizational perspective, the US health care system is highly fragmented. By this we mean that critical tasks in the financing and provision of health care are distributed across a variety of distinct, often competing, entities each with its own objectives, obligations and...
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