To what extent do managed care organizations contract for tertiary care services, and what is the impact of this type of contracting on health care markets? Today, many managed care plans employ this practice, but little is known about how it works or whether it is effective. The investigators described the current state of selective contracting for tertiary care services by managed care organizations; assessed the impact of characteristics of managed care plans, hospitals, and health care markets on the use and form of selective contracts for tertiary care services; examine the extent to which managed care plans channel their tertiary care patients to particular hospitals in response to price concessions; and evaluated the broader market effect of managed care penetration on the use, cost, concentration, and quality of tertiary care services provided to populations in different geographic areas. The investigators hypothesized that the ability of managed care plans to secure high quality tertiary care services for their enrollees at low cost is an important factor in assessing the success of a health care system based on managed care. The objective of this project was to help decisionmakers understand whether and how selective contracting improves the delivery of tertiary care services.