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Provider responses to discontinuous tariffs: evidence from Dutch rehabilitation care

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  • Katalin Gaspar

    (Talma Institute/VU University Amsterdam)

  • Xander Koolman

    (Talma Institute/VU University Amsterdam)

Abstract

Abrupt jumps in reimbursement tariffs have been shown to lead to unintended effects in physicians’ behavior. A sudden change in tariffs at a pre-defined point in the treatment can incentivize health care providers to prolong treatment to reach the higher tariff, and then to discharge patients once the higher tariff is reached. The Dutch reimbursement schedule in hospital rehabilitation care follows a two-threshold stepwise-function based on treatment duration. We investigated the prevalence of strategic discharges around the first threshold and assessed whether their share varies by provider type. Our findings suggest moderate response to incentives by traditional care providers (general and academic hospitals, rehabilitation centers and multicategorical providers), and strong response by profit-oriented independent treatment centers. When examining the variation in response based on the financial position of the organization, we found a higher probability of manipulation among providers in financial distress. Our findings provide multiple insights and possible indicators to identify provider types that may be more prone to strategic behavior.

Suggested Citation

  • Katalin Gaspar & Xander Koolman, 2022. "Provider responses to discontinuous tariffs: evidence from Dutch rehabilitation care," International Journal of Health Economics and Management, Springer, vol. 22(3), pages 333-354, September.
    • Handle: RePEc:kap:ijhcfe:v:22:y:2022:i:3:d:10.1007_s10754-021-09322-5
    DOI: 10.1007/s10754-021-09322-5
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    References listed on IDEAS

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    Cited by:

    1. Katalin Gaspar & Ramsis Croes & Misja Mikkers & Xander Koolman, 2024. "Length of hospital stays and financial incentives: evidence from Dutch rehabilitation centers," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 25(5), pages 731-741, July.

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    More about this item

    Keywords

    Provider payment; Provider incentive; Policy evaluation; Regulated competition; The Netherlands;
    All these keywords.

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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