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Physician reimbursement, time-consistency and the quality of care
[Ärztevergütung, Zeitkonsistenz und die Qualität medizinischer Leistungen]

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  • Nuscheler, Robert
Abstract
We use a model of horizontal and vertical differentiation to study physicians’ incentives to provide quality in the physician-patient relationship under price regulation. If the price is the only regulatory variable, the social planner cannot implement the first-best policy. Moreover, the second-best policy is time inconsistent. Excess entry and firstbest efficient total quality provision is observed in the game without commitment. Allowing physicians to compete in prices does not solve the commitment problem since the competitive solution coincides with the time consistent outcome. In the median voter equilibrium the time consistency problem is more severe.

Suggested Citation

  • Nuscheler, Robert, 2002. "Physician reimbursement, time-consistency and the quality of care [Ärztevergütung, Zeitkonsistenz und die Qualität medizinischer Leistungen]," Discussion Papers, Research Unit: Market Processes and Governance FS IV 02-16, WZB Berlin Social Science Center.
    • Handle: RePEc:zbw:wzbmpg:fsiv0216
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Economics of health care markets; time consistency; price regulation; quality competition; spatial competition;
    All these keywords.

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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