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Third degree waiting time discrimination: optimal allocation of a public sector healthcare treatment under rationing by waiting

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Author Info

  • Hugh Gravelle

    (National Primary Care Research and Development Centre, Centre for Health Economics, University of York, York, UK)

  • Luigi Siciliani

    (Department of Economics and Related Studies, Centre for Health Economics, University of York, York, UK)

Abstract

In many public healthcare systems treatments are rationed by waiting time. We examine the optimal allocation of a fixed supply of a given treatment between different groups of patients. Even in the absence of any distributional aims, welfare is increased by third degree waiting time discrimination: setting different waiting times for different groups waiting for the same treatment. Because waiting time imposes dead weight losses on patients, lower waiting times should be offered to groups with higher marginal waiting time costs and with less elastic demand for the treatment. Copyright © 2008 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.1423
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Bibliographic Info

Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 18 (2009)
Issue (Month): 8 ()
Pages: 977-986

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Handle: RePEc:wly:hlthec:v:18:y:2009:i:8:p:977-986

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Hugh Gravelle & Luigi Siciliani, 2007. "Ramsey Waits: Allocating Public Health Service Resources when there is Rationing by Waiting," Discussion Papers 07/15, Department of Economics, University of York.
  2. repec:rus:hseeco:122140 is not listed on IDEAS
  3. Hugh Gravelle & Luigi Siciliani, 2007. "Optimal Waits and Charges in Health Insurance," Discussion Papers 07/02, Department of Economics, University of York.
  4. Gianni De Fraja, 2003. "Reverse Discrimination and Efficiency in Education," CEIS Research Paper 38, Tor Vergata University, CEIS.
  5. Hugh Gravelle & Luigi Siciliani, 2006. "Is Waiting-time Prioritisation Welfare Improving?," Discussion Papers 06/13, Department of Economics, University of York.
  6. Lindsay, Cotton M & Feigenbaum, Bernard, 1984. "Rationing by Waiting Lists," American Economic Review, American Economic Association, vol. 74(3), pages 404-17, June.
  7. Hoel, Michael, 2007. "What should (public) health insurance cover?," Journal of Health Economics, Elsevier, vol. 26(2), pages 251-262, March.
  8. Farnworth, Michael G., 2003. "A game theoretic model of the relationship between prices and waiting times," Journal of Health Economics, Elsevier, vol. 22(1), pages 47-60, January.
  9. Hoel, Michael & Saether, Erik Magnus, 2003. "Public health care with waiting time: the role of supplementary private health care," Journal of Health Economics, Elsevier, vol. 22(4), pages 599-616, July.
  10. Martin, Stephen & Smith, Peter C., 1999. "Rationing by waiting lists: an empirical investigation," Journal of Public Economics, Elsevier, vol. 71(1), pages 141-164, January.
  11. Jeremy Hurst & Luigi Siciliani, 2003. "Tackling Excessive Waiting Times for Elective Surgery: A Comparison of Policies in Twelve OECD Countries," OECD Health Working Papers 6, OECD Publishing.
  12. Luigi Siciliani, 2008. "A note on the dynamic interaction between waiting times and waiting lists," Health Economics, John Wiley & Sons, Ltd., vol. 17(5), pages 639-647.
  13. Martin, Stephen & Rice, Nigel & Jacobs, Rowena & Smith, Peter, 2007. "The market for elective surgery: Joint estimation of supply and demand," Journal of Health Economics, Elsevier, vol. 26(2), pages 263-285, March.
  14. Hugh Gravelle & Peter Smith & Ana Xavier, 2003. "Performance signals in the public sector: the case of health care," Oxford Economic Papers, Oxford University Press, vol. 55(1), pages 81-103, January.
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Cited by:
  1. Simona Grassi & Ching-to Albert Ma, . "Optimal Public Rationing and Price Response," Boston University - Department of Economics - Working Papers Series wp2009-008, Boston University - Department of Economics.
  2. Dixon, Huw & Siciliani, Luigi, 2009. "Waiting-time targets in the healthcare sector: How long are we waiting?," Journal of Health Economics, Elsevier, vol. 28(6), pages 1081-1098, December.

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