Competition among Health Maintenance Organizations
AbstractWe develop a model of competition among health maintenance organizations (HMOs) to analyze the effects of market power, scale economies, and asymmetric knowledge of health risk on market outcomes. We find that competition among HMOs may, but need not, ensure socially preferred outcomes. Market power or scale economies can sometimes admit socially preferred outcomes when they would otherwise not arise. Asymmetric knowledge of health risk may or may not be constraining. When it is constraining, a variety of patterns of incomplete health insurance can arise, along with excessive or insufficient treatment and preventive care for either high-risk or low-risk individuals. Copyright (c) 1997 Massachusetts Institute of Technology.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Journal of Economics & Management Strategy.
Volume (Year): 6 (1997)
Issue (Month): 1 (03)
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Web page: http://www.kellogg.northwestern.edu/research/journals/JEMS/
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- Glazer, Jacob & McGuire, Thomas G., 2011. "Gold and Silver health plans: Accommodating demand heterogeneity in managed competition," Journal of Health Economics, Elsevier, vol. 30(5), pages 1011-1019.
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- Daniel McFadden & Carlos Noton & Pau Olivella, 2013. "Minimum Coverage Regulation in Insurance Markets," Documentos de Trabajo 301, Centro de Economía Aplicada, Universidad de Chile.
- Belli, Paolo, 2001. "How adverse selection affects the health insurance market," Policy Research Working Paper Series 2574, The World Bank.
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