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Quality control mechanisms under capitation payment for medical services

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  • Pierre Thomas Léger

Abstract

As a result of rising health care costs, many countries, including the United States, have turned to managed care organizations and the use of capitation payment systems. Although this type of system is an effective mechanism for reducing excessive utilization of health care, it may lead to the underprovision of medical services. In this paper propensity to underprovide medical services in a prepayment system as well as the effects of auditing/monitoring on physician behaviour and patient well-being are examined. Conditions are found under which managed care yields more efficient outcomes than traditional fee-for-service care.

Suggested Citation

  • Pierre Thomas Léger, 2000. "Quality control mechanisms under capitation payment for medical services," Canadian Journal of Economics, Canadian Economics Association, vol. 33(2), pages 564-586, May.
    • Handle: RePEc:cje:issued:v:33:y:2000:i:2:p:564-586
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    Citations

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    Cited by:

    1. R. Amy Puenpatom & Robert Rosenman, 2006. "Efficiency of Thai provincial public hospitals after the introduction of National Health Insurance Program," Working Papers 2006-2, School of Economic Sciences, Washington State University.
    2. Ehud Guttel & Barak Medina, 2007. "Less Crime, More (Vulnerable) Victims: Game Theory and the Distributional Effects of Criminal Sanctions," Levine's Bibliography 122247000000001799, UCLA Department of Economics.
    3. Blomqvist, Ake & Leger, Pierre Thomas, 2005. "Information asymmetry, insurance, and the decision to hospitalize," Journal of Health Economics, Elsevier, vol. 24(4), pages 775-793, July.
    4. Ehud Guttel & Barak Medina, 2007. "Less Crime, More (Vulnerable) Victims: Game Theory and the Distributional Effects of Criminal Sanctions," Discussion Paper Series dp472, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
    5. Eugenia Amporfu, 2013. "Effect of regulated user fee on quality of healthcare for the poor and the non-poor," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 60(4), pages 357-373, December.

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