Hospital pricing and public hospital crisis. An analysis by price theory

Tarification hospitalière et maux de l’hôpital public. Une analyse par la théorie des prix

François Facchini ()
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François Facchini: UP1 UFR02 - Université Paris 1 Panthéon-Sorbonne - École d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique

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Abstract: The crisis of the public hospital is the crisis of a public healthcare production system that deprives itself of central information, price information. In a market, demand rationing is done on the basis of price. Each consumer limits the quantity they buy based on price. If the price increases, they generally buy less. If the price decreases, they decide to buy more. Choosing a public healthcare system deprives decision-makers of this price information, but does not free them from the obligation to ration. In a world of scarcity, choosing means giving up. If the State increases healthcare spending by increasing contributions, it gives up increasing education spending or forces consumers by reducing their income by increasing contributions to give up buying bread or wine. The consequence is that the government, the State, is obliged to find alternative methods of price rationing. Generally, it rations by quantity: closure of care units, reduction in the length of hospital stays, lengthening of hospital waiting lists, increasingly long queues in emergency rooms and significant changes in the provision of care, because hospital directors favour the most lucrative diseases. If we add to this the effects of the structure of property rights on staff absenteeism and health insurance fraud, we have an explanation for the ills of the public hospital in France.

Keywords: price; Rationing; Rationing by waiting; public pricing; Public spending; Health spending; Hopital; prix; rationnement; dépenses sociales; dépenses publiques; tarification publique (search for similar items in EconPapers)
Date: 2024-05-01
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Published in G&FP - Gestion & finances publiques : la revue, 2024, 3 (3), pp.8-17. ⟨10.1684/gfp.2024.3.002⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04668712

DOI: 10.1684/gfp.2024.3.002

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