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Gatekeeping in health care

We study the competitive effects of restricting direct access to secondary care by gatekeeping, focusing on the informational role of gatekeeping general practitioners (GPs). We consider a secondary care market with two hospitals choosing the quality and specialisation of their care. GPs perfectly observe the diagnosis of a patient and the exact characteristics of the secondary care market. Patients are either informed or uninformed when accessing the hospital market. We consider two distinct cases: first, we let the fraction of informed patients be exogenous, implying that the regulator can only influence patients' decision of consulting a GP by making this compulsory ('direct gatekeeping'). Second, we endogenise this fraction by assuming GP consultation to be costly for the patient. Then the reulator can influence the GP attendance rate through the regulated price ('indirect gatekeeping'). A main finding of the paper is that strict gatekeeping may not be socially desirable, even if it is costless.

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Paper provided by University of Bergen, Department of Economics in its series Working Papers in Economics with number 10/03.

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Length: 28 pages
Date of creation: 04 Jul 2003
Date of revision:
Handle: RePEc:hhs:bergec:2003_010
Contact details of provider: Postal: Institutt for økonomi, Universitetet i Bergen, Postboks 7802, 5020 Bergen, Norway
Phone: (+47)55589200
Fax: (+47)55589210
Web page: http://www.uib.no/econ/en
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  3. GONZALEZ, Paula, 2003. "The "gatekeeping" role of general practitioners. Does patients' information matter ?," CORE Discussion Papers 2003089, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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  8. David Dranove & Daniel Kessler & Mark McClellan & Mark Satterthwaite, 2002. "Is More Information Better? The Effects of 'Report Cards' on Health Care Providers," NBER Working Papers 8697, National Bureau of Economic Research, Inc.
  9. Pedro Pita Barros & Xavier Martinez-Giralt, 2002. "Public and Private Provision of Health Care," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 11(1), pages 109-133, 03.
  10. Schultz, Christian, 2005. "Transparency on the consumer side and tacit collusion," European Economic Review, Elsevier, vol. 49(2), pages 279-297, February.
  11. d'Aspremont, C & Gabszewicz, Jean Jaskold & Thisse, J-F, 1979. "On Hotelling's "Stability in Competition"," Econometrica, Econometric Society, vol. 47(5), pages 1145-50, September.
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  16. Ching-to Ma & James Burgess, 1993. "Quality competition, welfare, and regulation," Journal of Economics, Springer, vol. 58(2), pages 153-173, June.
  17. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
  18. Pedro Pita Barros, 1998. "The black box of health care expenditure growth determinants," Health Economics, John Wiley & Sons, Ltd., vol. 7(6), pages 533-544.
  19. Scott, Anthony, 2000. "Economics of general practice," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 22, pages 1175-1200 Elsevier.
  20. Hugh Gravelle & Giuliano Masiero, . "Quality incentives in a regulated market with imperfect information and switching costs: capitation in general practice," Discussion Papers 00/18, Department of Economics, University of York.
  21. Helmut Bester, 1998. "Quality Uncertainty Mitigates Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 29(4), pages 828-844, Winter.
  22. 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.
  23. Schultz, Christian, 2004. "Market transparency and product differentiation," Economics Letters, Elsevier, vol. 83(2), pages 173-178, May.
  24. Beitia, Arantza, 2003. "Hospital quality choice and market structure in a regulated duopoly," Journal of Health Economics, Elsevier, vol. 22(6), pages 1011-1036, November.
  25. Nuscheler, Robert, 2002. "Physician reimbursement, time-consistency and the quality of care
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  26. Economides, Nicholas, 1993. "Quality variations in the circular model of variety-differentiated products," Regional Science and Urban Economics, Elsevier, vol. 23(2), pages 235-257, April.
  27. Varian, Hal R, 1980. "A Model of Sales," American Economic Review, American Economic Association, vol. 70(4), pages 651-59, September.
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