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Using fees to reduce bed-blocking: a game between hospitals and long-term care providers

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  • Snorre Kverndokk

    (The Ragnar Frisch Centre for Economic Research)

  • Hans Olav Melberg

    (University of Oslo)

Abstract

In several countries, a fee has been introduced to reduce bed-blocking in hospitals. This paper studies the implications of this fee for the strategic decisions of the hospitals and the long-term care providers. We introduce a Stackelberg game where the hospital is the leader and the care provider the follower. The policy reduces the treatment time at the hospital but does not necessarily lead to less bed-blocking, as this depends on the treatment time and bed-blocking before the reform. We test the results with data from the Norwegian Coordination Reform introduced in 2012 and find that this reform led to a large reduction in bed-blocking. The direct effect was even larger than a naïve comparison would suggest because hospitals began to report patients as ready to be discharged earlier than before the reform. Confronted with the theoretical predictions, this would mean that hospital services in average were set relatively close to the minimum levels before the reform.

Suggested Citation

  • Snorre Kverndokk & Hans Olav Melberg, 2021. "Using fees to reduce bed-blocking: a game between hospitals and long-term care providers," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(6), pages 931-949, August.
  • Handle: RePEc:spr:eujhec:v:22:y:2021:i:6:d:10.1007_s10198-021-01299-9
    DOI: 10.1007/s10198-021-01299-9
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    References listed on IDEAS

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    Cited by:

    1. Han Hu & Zhao Zhang, 2022. "Long-Term Care Services and Insurance System in China: An Evolutionary Game Analysis," Sustainability, MDPI, vol. 15(1), pages 1-22, December.
    2. Øystein Hernæs & Snorre Kverndokk & Simen Markussen & Henning Øien, 2023. "When Health Trumps Money: Economic Incentives and Health Equity in the Provision of Nursing Homes," CESifo Working Paper Series 10359, CESifo.
    3. Hernæs, Øystein & Kverndokk, Snorre & Markussen, Simen & Øien, Henning, 2023. "When health trumps money: Economic incentives and health equity in the public provision of nursing homes in Norway," Social Science & Medicine, Elsevier, vol. 333(C).

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