Star Ratings and Willingness to Travel for Hospital Care

Choosing a hospital for elective inpatient care is a complex decision due to pervasive information asymmetries and multidimensional quality attributes. Online reviews provide an accessible and salient source of hospital quality information that could influence patient choices. Using the universe of hospital Yelp reviews and inpatient claims data for elective procedures in Florida (2012-2017), we exploit exogenous variation in online ratings to estimate the causal effect of online reviews on hospital selection. Depending on the underlying condition, we find that patients are willing to travel 7.9% farther for labor and delivery and 33.5% farther for orthopedic surgery for a one-standard-deviation increase in a hospital's rating percentile rank within its market, which is roughly a half-star increase. The larger response for orthopedic procedures is consistent with greater reliance on online information when provider relationships are weaker. Falsification tests on emergency admissions yield null results, confirming that online reviews influence elective rather than urgent decision-making. Our findings highlight the role of consumer-generated information in healthcare markets and suggest that online platforms can meaningfully shape provider competition.