COLUMBUS, OH – July 12, 2024 – A new study published in the American Economic Review reveals how a large-scale hospital modernization program in North Carolina, operated by The Duke Endowment, led to substantial improvements in health outcomes and reduced racial health disparities. The research, conducted by Alex Hollingsworth, Krzysztof Karbownik, Melissa Thomasson, and Anthony Wray, examines the effects of The Duke Endowment's investments in hospitals during the first half of the 20th century.
The study finds that the modernization efforts, which included building and expanding hospitals, upgrading medical technology, and improving management practices, resulted in a 7.5% reduction in infant mortality rates. Notably, the reduction was three times larger for Black infants (13.6%) compared to White infants (4.7%), significantly narrowing the Black-White infant mortality gap. Improved access also had lasting health effects, with long-run mortality rates for those exposed at birth declining by 9.0%
“We found that these investments not only increased the number and quality of hospital beds but also attracted higher-quality physicians to underserved areas,” said co-author Alex Hollingsworth, an associate professor The Ohio State University and research associate at NBER. “The improvements in health outcomes were both immediate and long-lasting, persisting for decades.”
The Duke Endowment’s funding led to a 40% increase in the number of not-for-profit hospitals, a 70% increase in the number of not-for-profit hospitals beds, and a 60% increase in high-quality physicians. These changes contributed to a lasting enhancement in healthcare capacity and quality.
The study also highlights the complementarity between hospital modernization and medical innovation. Hospitals modernized by The Duke Endowment were better able to take advantage of new medical innovations, such as the introduction of the first effective antibiotics in 1937. The impact of Duke funding nearly tripled post-antibiotic era.
“Our findings emphasize the importance of investments in general purpose healthcare, especially in areas with limited resources,” said Thomasson. “These investments are cost-effective and yield significant long-term health benefits, particularly for marginalized groups.”
Financial barriers to healthcare access, physician shortages, rural hospital closures, and general difficulty in accessing the healthcare system are pressing issues in the U.S. today. Connecting to these issues, Hollingsworth stresses that "our findings tell us how valuable the first access to high-quality medical care are, which underscores the critical importance of maintaining the last available medical provider."
The study also informs the value of healthcare investments in developing regions, where access to quality medical care is often severely limited. In many parts of the developing world, the healthcare infrastructure remains inadequate, and the absence of reliable medical services can have devastating effects on public health. The historical successes observed in North Carolina suggest that in areas with no access to healthcare similar investments in infrastructure, coupled with innovative medical technologies and strong oversight, could lead to large improvements in health outcomes in these regions.
For more information, please contact: Alex Hollingsworth (email: Hollingsworth.126@osu.edu, web: https://hollina.github.io)