On resource allocation in health care: The case of concierge medicine

Resource allocation generally involves a tension between efficiency and equity, particularly in health care. The growth in exclusive physician arrangements using non-linear prices is leading to consumer segmentation with theoretically ambiguous welfare implications. We study concierge medicine, in which physicians only provide care to patients paying a retainer fee. We find limited evidence of selection based on health and stronger evidence of selection based on income. Using a matching strategy that leverages the staggered adoption of concierge medicine, we find large spending increases and no average mortality effects for patients impacted by the switch to concierge medicine.