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Comparing organizational structures in health services

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  • Jelovac, Izabela
  • Macho-Stadler, Ines

Abstract

The study of organizational choice is crucial to the understanding of firms' efficiency. We consider this issue applied to contracts on health services. In particular, we analyze the circumstances under which it is better for an insurer to contract with both the hospital and the physician instead of contracting exclusively with the hospital, delegating to the latter the power to contract the physician.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 49 (2002)
Issue (Month): 4 (December)
Pages: 501-522

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Handle: RePEc:eee:jeborg:v:49:y:2002:i:4:p:501-522

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References

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  1. Poitevin, M., 2000. "Can the Theory of Incentives Explain Devcentralization?," Cahiers de recherche 2000-13, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
  2. Baliga, Sandeep & Sjostrom, Tomas, 1998. "Decentralization and Collusion," Journal of Economic Theory, Elsevier, vol. 83(2), pages 196-232, December.
  3. Ching-to Albert Ma, 1994. "Health Care Payment Systems: Cost and Quality Incentives," Papers 0047, Boston University - Industry Studies Programme.
  4. Grossman, Sanford J & Hart, Oliver D, 1986. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 691-719, August.
  5. Gaynor, Martin, 1994. "Issues in the Industrial Organization of the Market for Physician Services," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 3(1), pages 211-55, Spring.
  6. Nahum Melamad & Dilip Mookherjee & Stefan Reichelstein, 1996. "Contract Complexity, Incentives and the Value of Delegation," Papers 0070, Boston University - Industry Studies Programme.
  7. Macho-Stadler, I. & Perez-Castrillo, J.D., 1990. "Double risque moral et délégation," DELTA Working Papers 90-21, DELTA (Ecole normale supérieure).
  8. POITEVIN, Michel, 2000. "Innis Lecture: Can the Theory of Incentives Explain Decentralization?," Cahiers de recherche 2000-13, Universite de Montreal, Departement de sciences economiques.
  9. Brooks, John M. & Dor, Avi & Wong, Herbert S., 1997. "Hospital-insurer bargaining: An empirical investigation of appendectomy pricing," Journal of Health Economics, Elsevier, vol. 16(4), pages 417-434, August.
  10. Laffont, Jean-Jacques & Martimort, David, 1995. "Collusion and Delegation," IDEI Working Papers 54, Institut d'Économie Industrielle (IDEI), Toulouse.
  11. Izabela Jelovac, 2001. "Physicians' payment contracts, treatment decisions and diagnosis accuracy," Health Economics, John Wiley & Sons, Ltd., vol. 10(1), pages 9-25.
  12. Randall P. Ellis & Thomas G. McGuire, 1993. "Supply-Side and Demand-Side Cost Sharing in Health Care," Journal of Economic Perspectives, American Economic Association, vol. 7(4), pages 135-151, Fall.
  13. Joseph P. Newhouse, 1992. "Medical Care Costs: How Much Welfare Loss?," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 3-21, Summer.
  14. Myerson, Roger B., 1982. "Optimal coordination mechanisms in generalized principal-agent problems," Journal of Mathematical Economics, Elsevier, vol. 10(1), pages 67-81, June.
  15. Robinson, James C, 1996. "Administered Pricing and Vertical Integration in the Hospital Industry," Journal of Law and Economics, University of Chicago Press, vol. 39(1), pages 357-78, April.
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Citations

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Cited by:
  1. Barlo, Mehmet & Ayca, Ozdogan, 2012. "Team beats collusion," MPRA Paper 37449, University Library of Munich, Germany.
  2. Kurt R. Brekke & Rosella Levaggi & Luigi Siciliani & Odd Rune Straume, 2011. "Patient Mobility, Health Care Quality and Welfare," NIPE Working Papers 26/2011, NIPE - Universidade do Minho.
  3. Bernd Theilen, 2012. "Decentralization of contracts with interim side-contracting," Theory and Decision, Springer, vol. 73(4), pages 561-590, October.
  4. Siciliani, Luigi, 2006. "Selection of treatment under prospective payment systems in the hospital sector," Journal of Health Economics, Elsevier, vol. 25(3), pages 479-499, May.
  5. Pedro Barros & Xavier Martinez-Giralt, 2009. "Contractual design and PPPs for hospitals: lessons for the Portuguese model," The European Journal of Health Economics, Springer, vol. 10(4), pages 437-453, October.
  6. Kathleen A. Carroll & Jane E. Ruseski, 2011. "Modeling Internal Decision Making Process: An Explanation Of Conflicting Empirical Results On Behavior Of Non‐Profit And For‐Profit Hospitals," Contemporary Economic Policy, Western Economic Association International, vol. 29(4), pages 510-523, October.
  7. Theilen, Bernd, 2009. "Decentralization and the Gains from Monitoring," Working Papers 2072/42863, Universitat Rovira i Virgili, Department of Economics.
  8. Pedro Pita Barros & Xavier Martinez-Giralt, 2006. "Contractual design and public-private parternships for hospitals," Working Papers 292, Barcelona Graduate School of Economics.
  9. Theilen Bernd, 2008. "Lobbying and Contract Delegation in Public Procurement," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 1-35, September.
  10. Miguel A. Sanchez & Rafael Hortala-Vallve, 2005. "Hierarchic contracting," LSE Research Online Documents on Economics 6548, London School of Economics and Political Science, LSE Library.
  11. Mehmet Barlo & Ayça Özdoğan, 2013. "The Optimality of Team Contracts," Games, MDPI, Open Access Journal, vol. 4(4), pages 670-689, November.
  12. Kuhn, Michael & Siciliani, Luigi, 2013. "Manipulation and auditing of public sector contracts," European Journal of Political Economy, Elsevier, vol. 32(C), pages 251-267.
  13. Rafael Hortala-Vallve & Miguel Sanchez, 2005. "Hierarchic contracting," STICERD - Distributional Analysis Research Programme Papers 73, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.

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