Matthew Grennan is an Assistant Professor of Health Care Management at The Wharton School of the University of Pennsylvania, where he has been on the faculty since 2013. He is also a Faculty Research Fellow at the National Bureau of Economic Research and a Senior Fellow at the Leonard Davis Institute of Health Economics. In July 2021, he will join the Haas School of the University of California, Berkeley as Associate Professor of Economics Analysis and Policy and Faculty Director of the Robinson Life Sciences Business and Entrepreneurship program.
Grennan’s research studies health care management using empirical and theoretical models from economics. His recent work examines how complexities such as imperfect information, misaligned stakeholders, new technology, and government regulation interact to affect the cost and quality of health care. Grennan's research relates closely to his teaching in health care entrepreneurship, data analytics, and technology strategy. It also informs recent business and public policy debates regarding price transparency, market power, and FDA regulation of new products in the health care sector.
Grennan has received teaching awards from Wharton, Toronto (Rotman), and Poets & Quants. His research has been published in the top general interest journals in economics, management, and policy, including the American Economic Review, Management Science, and Health Affairs. Grennan's research has been funded through leading institutions such as the National Science Foundation and National Institute for Health Care Management.
Assistant Professor of Health Care Management
The Wharton School, University of Pennsylvania
Develop a model where targeted payments from manufacturers have different estimated effects on prescribing for different doctors, prescribing can be biased at baseline, and prices negotiated between payers and upstream suppliers. In estimates using market and clinical data for statins 2011-12, AMC policy spillovers identify heterogenous payment effects, and payments are beneficial on net because they counteract under-prescribing.
“Spillovers Across Categories in the Medical Device Industry” R&R @ Journal of Economics Management and Strategy, with Charu Gupta and Mara Lederman
Responses to new product introductions suggest that buyer-level spillovers represent up to half of all potential demand spillovers and one-third of the overall correlation in supplier shares across categories, with implications for firm strategy and antitrust policy for firms selling in multiple product categories.
“Medical Device Firm Payments To Physicians Exceed What Drug Companies Pay Physicians, Target Surgical Specialists” Health Affairs (2021), with Alon Bergman and Ashley Swanson
Relative to drug firm payments, device firm payments were: seven times as large as a percentage of industry revenue, more often related to product development and training, and more strongly correlated with physicians’ Medicare billing amounts. Top-paying firms dominate the most prominent device categories.
“Mergers and Marginal Costs: New Evidence on Hospital Buyer Power” RAND Journal of Economics (2021), with Stuart Craig and Ashley Swanson
Mergers among a sample of US Hospitals 2009-15 result in little to no costs savings on average, despite large expected opportunities for such. Savings, when they occur, tend to be local, and offset by managerial costs of merging.
“Transparency and Negotiated Prices: The Value of Information in Hospital-Supplier Bargaining” Journal of Political Economy (2020), with Ashley Swanson
Across a large number of important product categories, access to information on purchasing by peer hospitals leads to reductions in the prices hospitals negotiate for supplies. Asymmetric information about seller willingness to concede finds stronger support than a purchasing manager agency mechanism. Transparency decreases high prices, but does not affect low prices.
“Regulating Innovation with Uncertain Quality: Information, Risk, and Access in Medical Devices” American Economic Review (2020), with Bob Town
Product testing can reduce consumer uncertainty, but also increase entry costs and delay entry. In a stent case study, no monitoring would severely depress demand; "post-market" monitoring would maximize welfare.
PURC Prize for Best Paper in Regulatory Economics (2018)
“Bargaining Ability and Competitive Advantage: Empirical Evidence from Medical Devices” Management Science (2014)
Prices vary widely across buyers of the same product. A structural model of demand and negotiated prices disentangles bargaining position variation due to heterogeneous preferences from bargaining abilities. Variation in bargaining abilities explains 79% of the price variation. Bargaining ability also has a large firm-specific component.
"Price Discrimination and Bargaining: Empirical Evidence from Medical Devices" American Economic Review (2013)
Bargaining generalizes the traditional price competition model, fits this data better, and interacts with competitive effects in counterfactuals. Allowing different prices to different buyers can increase competition, so group purchasing must increase bargaining ability to compensate.
HC Data Analytics
great mix of health data landscape, practicing data analytics in R, and bringing in experts to share their experience
Med Tech Strategy
can't imagine a better-designed course to take before entering the medical devices industry
totally changed the way I think and approach problems and business