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Selecting Negotiation Processes with Health Care

Xavier Martinez-Giralt () and Pedro Barros ()

UFAE and IAE Working Papers from Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC)

Abstract: We address the question of how a third-party payer (e.g. an insurer) decides what providers to contract with. Three different mechanisms are studied and their properties compared. A first mechanism consists in the third-party payer setting up a bargaining procedure with both providers jointly and simultaneously. A second mechanism envisages the outcome of the same simultaneous bargaining but independently with every provider. Finally, the last mechanism is of different nature. It is the so-called "any willing provider" where the third-party payer announces a contract and every provider freely decides to sign it or not. The main finding is that the decision of the third-party payer depends on the surplus to be shared. When it is relatively high the third-party payer prefers the any willing provider system. When, on the contrary, the surplus is relatively low, the third-party payer will select one of the other two systems accor ing to how bargaining power is distributed.

Keywords: Health Care Provision; Any Willing Provider; Bargaining (search for similar items in EconPapers)
JEL-codes: I12 I18 (search for similar items in EconPapers)
Date: 2000-11-05
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Persistent link: https://EconPapers.repec.org/RePEc:aub:autbar:467.00

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