Research
​Papers in Economics & Management
Turbocharging Profits? Contract Gaming and Revenue Allocation in Healthcare (with Atul Gupta and Adam Sacarny).
NBER Working Paper #32564. Revise and Resubmit, American Economic Journal: Applied Economics.
Firms often exploit loopholes in government contracts to boost revenues. The welfare consequences of this behavior depend on how firms use the marginal windfall dollar, yet little evidence exists to guide policymakers. This paper studies how hospitals allocated over $3 billion obtained from gaming a Medicare payment loophole. The average gaming hospital increased both Medicare and total revenue by around 10%, implying large spillovers on other payers. Consistent with theories of organizational behavior, nonprofit hospitals deployed most of the windfall toward operating costs, while for-profits deducted the entire amount off their balance sheet, distributing a substantial portion to executives and shareholders. Accordingly, we detect modest reductions in mortality rates at nonprofits but no changes at for-profits. Our results imply that the consequences of such engineered windfalls vary substantially by hospital ownership.
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Gender Mix and Team Performance: Evidence from Obstetrics (with Manasvini Singh)
[Draft available upon request]
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We investigate how the gender mix of expert teams affects performance in a high-stakes setting: childbirth. Exploiting the quasi-exogenous assignment of patients to two-member physician teams (Lead and Assisting), we find: (i) female-only teams achieve the best maternal outcomes, while male-only teams have the worst; and (ii) within mixed-gender teams, female-led teams perform worse than male-led teams. Performance differences are not driven by patient selection, team skill, or gender-specific physician preferences for procedures such as C-sections. Instead, they are directly attributable to the team’s gender mix. We propose that gender mix affects team performance primarily through gender norms, supported by two findings. First, gender mix affects how individual preferences are incorporated into team decisions, with female-only team decisions most closely reflecting average member preferences. Second, gender mix affects how teams manage challenges to effective teamwork, such as conflicting preferences or limited prior collaboration. Female-led mixed-gender teams perform especially poorly under these conditions, possibly because female leadership inverts traditional gender norms. This study concludes by offering policy and managerial insights for supporting an increasingly diverse workforce.​
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Getting Down to Business: Chain Ownership and Fertility Clinic Performance (with Julia Bodner).
Management Science (2024).
–Media coverage: Tradeoffs Podcast, Cato Institute Blog, Marginal Revolution, Clear Health Costs, Financial Times
–HBR practitioner summary and insights
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Acquisitions by corporate entities have fueled the growth of chain organizations in healthcare. A chain is a multiunit firm under the same ownership and management providing similar services in different locations. Chain ownership has been credited with boosting firm performance in the retail and service sectors but has been criticized for prioritizing profits over the well-being of patients in the healthcare sector. This paper finds that chain ownership improves healthcare outcomes in the market for In Vitro Fertilization (IVF). Using novel data on U.S. fertility clinics and difference-in-differences methods, we find that IVF cycles increase by 27.2%, and IVF success rates increase by 13.6% after acquisition by a fertility chain. We provide evidence that fertility chains facilitate resource and knowledge transfers needed to enhance quality and expand the IVF market. For example, acquired clinics change IVF processes and procedures to achieve the IVF gold standard of simultaneously reducing higher-risk multiple births and increasing singleton births. We discuss how the fertility sector’s relatively minimal market frictions and information asymmetries may incentivize chain owners to invest in quality.
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The Impact of Management on Clinical Performance: Evidence from Physician Practice Management Companies. [Ungated Version]
Management Science (2022).
–AOM William H. Newman Award Finalist, 2020; AOM HCM Division Best Paper Award, 2020; AOM HCM Best Paper Based on a Dissertation Award, 2020; Industry Studies Association’s Giarratani Rising Star Award, 2020
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Mergers and acquisitions in healthcare are increasingly leading to changes in firm management. This paper studies how a change in firm management impacts clinical performance using data on an understudied phenomenon: medical practice acquisitions by physician practice management companies (PPMCs). PPMCs market themselves as offloading the administrative burden of running a medical practice without compromising physician autonomy over clinical decisions. However, a PPMC’s management strategy and practices, such as performance monitoring and financial incentives, could influence physician behavior. For example, some PPMCs advertise increasing revenue through better financial management, whereas others also advertise improving quality through better clinical management. In this paper, I collect data on three large PPMCs that manage the practices of more than 40% of obstetricians and gynecologists (Ob-Gyns) in Florida between 2006 and 2014. An Ob-Gyn’s main clinical decision in childbirth involves a tradeoff between financial and clinical outcomes: cesarean sections (C-sections) are often more highly reimbursed than vaginal births but pose risks to maternal and infant health when not medically necessary. Using difference-in-differences methods, I find heterogeneous effects on C-sections depending on a PPMC’s publicized management strategy. Physicians acquired by PPMCs that focus on financial management increase the use of C-sections, resulting in less clinically appropriate care and worse patient outcomes. The opposite result is found when PPMCs focus on clinical management. I provide qualitative and quantitative evidence that differences in firm management are the most likely driver of changes in C-sections. This paper informs how the corporatization of medicine can alter clinical performance outcomes.
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Papers in Health Policy & Medicine
La Forgia, A., and McDevitt, R. (2025). How Should We Assess Quality of Health Care Services in Organizations Owned by Private Equity Firms? AMA Journal of Ethics.
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Yu, J., Bond, A., Braun, R. T., La Forgia, A., RoyChoudhury, A., Zhang, M., Kim., J, & Casalino, L. (2023). Physician Management Companies and Neonatology Prices, Utilization, and Adverse Clinical Outcomes. Pediatrics.
La Forgia, A., Bond, A., Braun, R. T., Yao, L. Kjaer, K., Zhang, M., & Casalino, L. (2022). Association of Physician Management Companies and Private Equity Investment With Commercial Health Care Prices Paid to Anesthesia Practitioners. JAMA Internal Medicine. [Ungated Version]
– Media Coverage: ModernHealthcare, HealthcareDive, Becker’s Hospital Review, JAMA Podcast, Wall Street Journal, Washington Post, Fortune
– Public Policy: FTC challenges PE-backed anesthesia group, U.S. Anesthesia Partners, Welsh Carson face class action over monopoly allegations
– Finalist for the 2023 NIHCM Research Award
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La Forgia, A., Bond, A., Braun, R. T., Kjaer, K., Zhang, M., & Casalino, L. (2021). Association of Surprise Billing Legislation with Prices Paid to In-Network and Out-of-Network Anesthesiologists in California, Florida, and New York. JAMA Internal Medicine. [Ungated Version]
– Media Coverage: U.S. News and World Report, BenefitsPro, Kaiser Health News, Forbes
– Public Policy: HHS report evaluating No Surprises Act
La Forgia, A., Maeda, J. L., & Banthin, J. S. (2017). Are Integrated Plan Providers Associated with Lower Premiums on the Health Insurance Marketplaces? Medical Care Research and Review.
– Media Coverage: The New York Times Upshot
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Work in Progress
​The Impact of Hospital Mergers and Acquisitions on Consumer Medical Debt
(with Alexander Adia, Adam Leive, and Elena Prager)
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The Impact of Physician Departures on Hospital Peers
(with Mathijs De Vaan)
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Physician Practice Acquisitions and Medicaid Enrollee Outcomes
(with Becky Staiger and Bohan Li)
The Market for Hospital Executives
(with Maggie Shi)
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Book Chapters, Proceedings, and Other Writing
La Forgia, A. (2024). Fertility Clinics Show How the Chain Model Can Improve Health Care. Harvard Business Review.
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La Forgia, A. (2020). The Impact of Acquisitions on Clinical Decisions: Evidence from Physician Practice Management Companies. Proceedings of the Eightieth Annual Meeting of the Academy of Management.
La Forgia, A., & Burns, L. R. (2017). Health Insurance in China. In L.R Burns & G. Liu (Eds.), China’s Health Care System and Reform (pp. 291-320). Cambridge, UK: Cambridge University Press.
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Interviews, News, and Popular Press
Private Equity Moves into Medical Practice. Chicago Medical Society.
Here’s What Happens To Anesthesia Contracts When Private Practices Get Bought Out w. Dr. Ambar La Forgia. Anesthesia Practice Management Success with Justin Harvey.
Buy and Bust: When Private Equity Comes for Rural Hospitals. Kaiser Health News.
Vermont’s largest hospital system and a massive insurance company are deadlocked. Thousands of patients are caught in the middle. Vermont Public Radio.