Name: DF Lunch Seminar with Merih Sevilir (IWH and ESMT-Berlin)
Start: 2026-06-04T12:30:00+02:00
End: 2026-06-04T13:45:00+02:00
Location: Kirchberg Campus

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“Creative Destruction in the Healthcare Sector: Hospital Closures and Patient Outcomes”

With the Lunch Seminar series, the Department of Finance is bringing eminent and up-and-coming researchers from around the world to Luxembourg.

Abstract

Since 1975, the US has seen the net closure of over 800 hospitals, with more ex-pected following the recent $1 trillion reduction in federal healthcare spending. This trend underscores the need to better understand how closures impact patient outcomes. Using confidential patient-level data, we track patients who are displaced from closed hospitals and forced to seek treatment elsewhere, measuring their outcomes pre- and post- closure. We find patients at closing hospitals who subsequently switch to another facility experience better health outcomes, relative to patients who do not lose their hospital. Patients displaced by closures tend to receive treatment at higher quality hospitals characterized by stronger financial performance and higher staffing ratios, suggesting that market exit by inefficient providers may reallocate patients toward better-performing institutions. While average displaced patients find higher quality care, elderly patients in rural areas experience elevated mortality rates, suggesting limited accessibility to substitute providers. Overall, our findings reveal heterogeneous effects of hospital closures: while they may enhance care quality and efficiency for most patients, they pose risks to patient health in immobile populations.

About the speaker

is Professor of Finance at ESMT Berlin. At the same time, she is the head of the Department of Laws, Regulations and Factor Markets at IWH Halle Institute for Economic Research.