Specialty Economies of Scope in English Hospitals: Cost Arguments for Colocation

Current policy responses to COVID-19 disruption and care backlogs suggest potential changes to the location and structure of hospital healthcare supply. However, few studies investigating the cost effects of hospital reorganisation consider changes in the mix of outputs or test for the existence of economies of scope in hospital healthcare. Attempts to create dedicated hubs to address healthcare demand backlogs could have unintended adverse cost effects where these are provided outside existing hospital arrangements. To evaluate this, we investigate the existence and size of economies of scope in English hospital healthcare.