Should physicians' dual practice be limited? An incentive approach
We develop a principal-agent model to analyze how the behavior of a physician in the public sector is affected by his activities in the private sector. We show that the physician will have incentives to over-provide medical services when he uses his public activity as a way of increasing his prestige as a private doctor. The health authority only benefits from the physician's dual practice when it is interested in ensuring a very accurate treatment for the patient. Our analysis provides a theoretical framework in which some actual policies implemented to regulate physicians' dual practice can be addressed. In particular, we focus on the possibility that the health authority offers exclusive contracts to physicians and on the implications of limiting physicians' private earnings. Copyright © 2004 John Wiley & Sons, Ltd.
Volume (Year): 13 (2004)
Issue (Month): 6 ()
|Contact details of provider:|| Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Holmstrom, Bengt & Milgrom, Paul, 1991. "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design," Journal of Law, Economics and Organization, Oxford University Press, vol. 7(0), pages 24-52, Special I.
- 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 211-255, Spring.
- Martin Gaynor, 1994. "Issues in the Industrial Organization of the Market for Physician Services," NBER Working Papers 4695, National Bureau of Economic Research, Inc.
- Ellis, Randall P. & McGuire, Thomas G., 1990. "Optimal payment systems for health services," Journal of Health Economics, Elsevier, vol. 9(4), pages 375-396, December.
- Rickman, Neil & McGuire, Alistair, 1999. "Regulating Providers' Reimbursement in a Mixed Market for Health Care," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(1), pages 53-71, February.
- Gal-Or, Esther, 1999. "Optimal Reimbursement and Malpractice Sharing Rules in Health Care Markets," Journal of Regulatory Economics, Springer, vol. 16(3), pages 237-265, November.
- Blomqvist, Ake, 1991. "The doctor as double agent: Information asymmetry, health insurance, and medical care," Journal of Health Economics, Elsevier, vol. 10(4), pages 411-432.
- Adrian Towse & Patricia Danzon, 1999. "Medical negligence and the NHS: an economic analysis," Health Economics, John Wiley & Sons, Ltd., vol. 8(2), pages 93-101.
- Ellis, Randall P. & McGuire, Thomas G., 1986. "Provider behavior under prospective reimbursement : Cost sharing and supply," Journal of Health Economics, Elsevier, vol. 5(2), pages 129-151, June.
- Paula González, 2002. "Policy Implications Of Transferring Patients To Private Practice," Working Papers. Serie AD 2002-12, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Dranove, David, 1988. "Demand Inducement and the Physician/Patient Relationship," Economic Inquiry, Western Economic Association International, vol. 26(2), pages 281-298, April.
- Izabela Jelovac, 2001. "Physicians' payment contracts, treatment decisions and diagnosis accuracy," Health Economics, John Wiley & Sons, Ltd., vol. 10(1), pages 9-25.
- Selden, Thomas M., 1990. "A model of capitation," Journal of Health Economics, Elsevier, vol. 9(4), pages 397-409, December. Full references (including those not matched with items on IDEAS)