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On a policy of transferring public patients to private practice

✍ Scribed by Paula González


Publisher
John Wiley and Sons
Year
2004
Tongue
English
Weight
233 KB
Volume
14
Category
Article
ISSN
1057-9230

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✦ Synopsis


Abstract

We consider an economy where public hospitals are capacity‐constrained, and we analyse the willingness of health authorities to reach agreements with private hospitals to have some of their patients treated there. When physicians are dual suppliers, we show that a problem of cream‐skimming arises and reduces the incentives of the health authority to undertake such a policy. We argue that the more dispersed are the severities of the patients, the greater the reduction in the incentives will be. We also show that, despite the patient selection problem, when the policy is implemented it is often the case that health authorities decide a more intensive transfer of patients to private practice. Copyright © 2004 John Wiley & Sons, Ltd.


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