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Physicians self selection of a payment mechanism: Capitation versus fee-for-service

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Author Info

  • Marie Allard

    (HEC Montréal)

  • Izabela Jelovac

    ()
    (Université de Lyon, Lyon, F-69003, France; CNRS, GATE Lyon St Etienne, UMR 5824, 93, chemin des Mouilles, Ecully, F-69130, France; ENS-LSH, Lyon, France)

  • Pierre-Thomas Léger

    (HEC Montréal, CIRANO, CIRPEE)

Abstract

The main question raised in this paper is whether GPs should self select their paymentmechanism or not. To answer it, we model GPs’ behavior under the most commonpayment schemes (capitation and fee-for-service) and when GPs can select one amongthose. Our analysis considers GPs heterogeneity in terms of both ability and sense ofprofessional duty. We conclude that when savings on specialists costs are the mainconcern of a regulator, GPs should be paid on a fee-for-service basis. Instead, whenfailures to identify severe conditions are the main concern, then payment self selection byGPs can be optimal.

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Bibliographic Info

Paper provided by Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure in its series Working Papers with number 1024.

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Length: 22 pages
Date of creation: 2010
Date of revision:
Handle: RePEc:gat:wpaper:1024

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Postal: 93, chemin des Mouilles - B.P.167 69131 - Ecully cedex
Phone: 33(0)472 29 30 89
Fax: 33(0)47229 30 90
Web page: http://www.gate.cnrs.fr/
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Related research

Keywords: GPs; gatekeeping; payment scheme; self selection; ability; professional duty;

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References

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  1. Etienne Dumont & Bernard Fortin & Nicolas Jacquemet & Bruce S. Shearer, 2008. "Physicians’ Multitasking and Incentives: Empirical Evidence from a Natural Experiment," CIRANO Working Papers 2008s-20, CIRANO.
  2. Marie Allard & Izabela Jelovac & Pierre-Thomas Léger, 2011. "Treatment and referral decisions under different physician payment mechanisms," Post-Print halshs-00650933, HAL.
  3. Paula González, 2010. "Gatekeeping versus direct-access when patient information matters," Health Economics, John Wiley & Sons, Ltd., vol. 19(6), pages 730-754.
  4. Rosella LEVAGGI & Lise ROCHAIX, 2007. "Exit, Choice Or Loyalty: Patient Driven Competition In Primary Care," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 78(4), pages 501-535, December.
  5. repec:hal:cesptp:halshs-00305309 is not listed on IDEAS
  6. Sabrina Teyssier, 2008. "Experimental Evidence on Inequity Aversion and Self-Selection between Incentive Contracts," Working Papers 0821, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
  7. Kurt R. Brekke & Robert Nuscheler & Odd Rune Straume, 2005. "Gatekeeping in Health Care," CESifo Working Paper Series 1552, CESifo Group Munich.
  8. Bernard Fortin & Nicolas Jacquemet & Bruce Shearer, 2008. "Policy Analysis in the Health-Services Market: Accounting for Quality and Quantity," Cahiers de recherche 0807, CIRPEE.
  9. Marinoso, Begona Garcia & Jelovac, Izabela, 2003. "GPs' payment contracts and their referral practice," Journal of Health Economics, Elsevier, vol. 22(4), pages 617-635, July.
  10. McGuire, Thomas G., 2000. "Physician agency," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 9, pages 461-536 Elsevier.
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Cited by:
  1. Allard, Marie & Jelovac, Izabela & Léger, Pierre Thomas, 2011. "Treatment and referral decisions under different physician payment mechanisms," Journal of Health Economics, Elsevier, vol. 30(5), pages 880-893.

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