Asymmetric Information from Physician Agency : Optimal Payment and Healthcare Quantity
We model asymmetric information arising from physician agency, and its effect on the design ofpayment and healthcare quantity. The physician-patient coalition aims to maximize a combinationof physician profit and patient benefit. The degree of substitution between profit and patient benefitin the physician-patient coalition is the physician’s private information, as is the patient’s intrinsicvaluation of treatment quantity. The equilibrium mechanism depends only on the physician-patientcoalition parameter. Moreover, the equilibrium mechanism exhibits extensive pooling, with prescribedquantity and payment being insensitive to the agency characteristics or patient’s actualbenefit. The optimal mechanism is interpreted as managed care where strict approval protocols areplaced on treatments.
|Date of creation:||2004|
|Contact details of provider:|| Postal: 15 Boulevard Gabriel Peri 92245 Malakoff Cedex|
Phone: 01 41 17 60 81
Web page: http://www.crest.fr
More information through EDIRC
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.:
- Chalkley, Martin & Malcomson, James M., 1998.
"Contracting for health services when patient demand does not reflect quality,"
Journal of Health Economics,
Elsevier, vol. 17(1), pages 1-19, January.
- Chalkley, M. & Malcomson, J.M., 1995. "Contracting for health services when patient demand does not reflect quality," Discussion Paper Series In Economics And Econometrics 9514, Economics Division, School of Social Sciences, University of Southampton.
- Ching-to Albert Ma, 1997. "Cost and Quality Incentives in Health Care: Altruistic Providers," Papers 0084, Boston University - Industry Studies Programme.
- Timothy Besley & Maitreesh Ghatak, 2003.
"Competition and incentives with motivated agents,"
LSE Research Online Documents on Economics
2202, London School of Economics and Political Science, LSE Library.
- Besley, Timothy J. & Ghatak, Maitreesh, 2004. "Competition and Incentives with Motivated Agents," CEPR Discussion Papers 4641, C.E.P.R. Discussion Papers.
- Tim Besley & Maitreesh Ghatak, 2005. "Competition and incentives with motivated agents," LSE Research Online Documents on Economics 928, London School of Economics and Political Science, LSE Library.
- Jean-Charles Rochet & Philippe Chone, 1998. "Ironing, Sweeping, and Multidimensional Screening," Econometrica, Econometric Society, vol. 66(4), pages 783-826, July.
- Mark Dusheiko & Hugh Gravelle & Rowena Jacobs & Peter Smith, 2003.
"The Effects of Budgets on Doctors Behaviour: Evidence from a Natural Experiment,"
The Centre for Market and Public Organisation
03/064, Department of Economics, University of Bristol, UK.
- Mark Dusheiko & Hugh Gravelle & Rowena Jacobs & Peter C Smith, "undated". "The Effect of Budgets on Doctor Behaviour: Evidence From A Natural Experiment," Discussion Papers 03/04, Department of Economics, University of York.
- 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.
- Jean Tirole & Jean-Jaques Laffont, 1985.
"Using Cost Observation to Regulate Firms,"
368, Massachusetts Institute of Technology (MIT), Department of Economics.
- James R. Baumgardner, 1991. "The Interaction between Forms of Insurance Contract and Types of Technical Change in Medical Care," RAND Journal of Economics, The RAND Corporation, vol. 22(1), pages 36-53, Spring.
- Thomas G. McGuire & Jacob Glazer, 2000. "Optimal Risk Adjustment in Markets with Adverse Selection: An Application to Managed Care," American Economic Review, American Economic Association, vol. 90(4), pages 1055-1071, September.
- Lewis, Tracy R. & Sappington, David E. M., 1989. "Countervailing incentives in agency problems," Journal of Economic Theory, Elsevier, vol. 49(2), pages 294-313, December.
- Ellis, Randall P., 1998. "Creaming, skimping and dumping: provider competition on the intensive and extensive margins1," Journal of Health Economics, Elsevier, vol. 17(5), pages 537-555, October.
- Ching-to Albert Ma, 1994.
"Health Care Payment Systems: Cost and Quality Incentives,"
0047, Boston University - Industry Studies Programme.
- Ma, Ching-to Albert, 1994. "Health Care Payment Systems: Cost and Quality Incentives," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 3(1), pages 93-112, Spring.
- Rochaix, Lise, 1989. "Information asymmetry and search in the market for physicians' services," Journal of Health Economics, Elsevier, vol. 8(1), pages 53-84, March.
- Jullien, Bruno, 2000.
"Participation Constraints in Adverse Selection Models,"
Journal of Economic Theory,
Elsevier, vol. 93(1), pages 1-47, July.
- Jullien, Bruno, 1997. "Participation Constraints in Adverse Selection Models," IDEI Working Papers 67, Institut d'Économie Industrielle (IDEI), Toulouse.
- Jack, William, 2005.
"Purchasing health care services from providers with unknown altruism,"
Journal of Health Economics,
Elsevier, vol. 24(1), pages 73-93, January.
- Billy Jack, 2001. "Purchasing Health Care Services from Providers with Unknown Altruism," Working Papers gueconwpa~03-03-13, Georgetown University, Department of Economics.
- Frank, Richard G. & Glazer, Jacob & McGuire, Thomas G., 2000.
"Measuring adverse selection in managed health care,"
Journal of Health Economics,
Elsevier, vol. 19(6), pages 829-854, November.
- Richard G. Frank & Jacob Glazer & Thomas G. McGuire, 1998. "Measuring Adverse Selection in Managed Health Care," NBER Working Papers 6825, National Bureau of Economic Research, Inc.
- Keeler, Emmett B. & Carter, Grace & Newhouse, Joseph P., 1998. "A model of the impact of reimbursement schemes on health plan choice," Journal of Health Economics, Elsevier, vol. 17(3), pages 297-320, June.
- Dranove, David, 1988. "Demand Inducement and the Physician/Patient Relationship," Economic Inquiry, Western Economic Association International, vol. 26(2), pages 281-298, April.
- Armstrong, Mark & Rochet, Jean-Charles, 1999. "Multi-dimensional screening:: A user's guide," European Economic Review, Elsevier, vol. 43(4-6), pages 959-979, April.
When requesting a correction, please mention this item's handle: RePEc:crs:wpaper:2004-37. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Florian Sallaberry)
If references are entirely missing, you can add them using this form.