Hospital’s activity-based financing system and manager-physician interaction

David Crainich (), Hervé LELEU () and Ana Mauleon ()

No 2006029, CORE Discussion Papers from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: Hospital financing systems determine ma jor decisions made by physicians and managers within hospitals. This paper examines the impact of the transition toward an activity-based reimburse- ment system that has emerged in most OCDE countries. We consider two initial situations, one for a private for-profit sector where both hospitals and physicians are paid on a fee-for-service basis and the other for a public sector under prospective budget and salaried physicians. For the private sector, our model focuses on the type of interaction (simultaneous, sequential or joint decision-making games) that should emerge between agents after the introduction of the activity-based financing system. In the public sector, the elasticity of the demand to the level of inputs seems to play a more crucial role in the transition.

Keywords: hospital's financing system; strategic interaction; activity-based pay- ment system. (search for similar items in EconPapers)
JEL-codes: I11 D4 D2 (search for similar items in EconPapers)
Date: 2006-03
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Related works:
Journal Article: Hospital’s activity-based financing system and manager: physician interaction (2011)
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Persistent link: http://EconPapers.repec.org/RePEc:cor:louvco:2006029

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