Provider Competition and Over-Utilization in Health Care

J. Boone, R.C.M.H. Douven

Research output: Working paperDiscussion paperOther research output

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Abstract

This paper compares the welfare effects of three ways in which health care can be organized: no competition (NC), competition for the market (CfM) and competition on the market (CoM) where the payer offers the optimal contract to providers in each case. We argue that each of these can be optimal depending on the contracting environment of a speciality. In particular, CfM is optimal in a clinical situation where the payer either has contractible information on provider quality or can enforce cost efficient protocols. If such contractible information is not available NC or CoM can be optimal depending on whether patients react to decentralized information on quality differences between providers and whether payer’s and patients’ preferences are aligned.
Original languageEnglish
Place of PublicationTilburg
PublisherEconomics
Number of pages45
Volume2014-055
Publication statusPublished - 22 Sep 2014

Publication series

NameCentER Discussion Paper
Volume2014-055

Fingerprint

Healthcare
Welfare effects
Patient preferences
Contracting
Optimal contract
Costs

Keywords

  • competition
  • health care
  • selective contracting
  • over-utilization
  • mechanism design

Cite this

Boone, J., & Douven, R. C. M. H. (2014). Provider Competition and Over-Utilization in Health Care. (CentER Discussion Paper; Vol. 2014-055). Tilburg: Economics.
Boone, J. ; Douven, R.C.M.H. / Provider Competition and Over-Utilization in Health Care. Tilburg : Economics, 2014. (CentER Discussion Paper).
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Boone, J & Douven, RCMH 2014 'Provider Competition and Over-Utilization in Health Care' CentER Discussion Paper, vol. 2014-055, Economics, Tilburg.

Provider Competition and Over-Utilization in Health Care. / Boone, J.; Douven, R.C.M.H.

Tilburg : Economics, 2014. (CentER Discussion Paper; Vol. 2014-055).

Research output: Working paperDiscussion paperOther research output

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Boone J, Douven RCMH. Provider Competition and Over-Utilization in Health Care. Tilburg: Economics. 2014 Sep 22. (CentER Discussion Paper).