Cost-Containment Policies in Healthcare Sector: the example of ESTAV in Tuscany

This paper investigates the impact of the establishment of local authorities which act as purchases managers in Tuscany in 2005, replacing the formers Local Health Authorities. These new authorities are responsible for the provision of goods and for the management of services; they are aimed at saving money and enhancing a more efficient allocation of resources. In order to assess the changes we use the Synthetic Control Procedure to create from the donor pool of all Italian Regions and Local Health Authorities, a weighted average which could resemble the exposed units in terms of expenditures before 2005, when ESTAVs were settled. We project the path of expenditures of these “Synthetic” units in the post-intervention period with the weights assigned previously and we measure differences with respect to the real path the cost variables. We also compare Tuscany with other Italian Regions and use permutations to conduct valid inference. Results are appearing, even at a smaller extent, and the effect of the policy seems to be in the desired direction, unfortunately with some caveats.