Market Conditions and General Practitioners’ Referrals

Tor Iversen and Ching-to Ma

No 2009:8, HERO Online Working Paper Series from University of Oslo, Health Economics Research Programme

Abstract: We study how market conditions influence referrals of patients by general practitioners (GPs). We set up a model of GP referral for the Norwegian health care system, where a GP receives capitation payment based on the number of patients in his practice, as well as fee-for-service reimbursements. A GP may accept new patients or close the practice to new patients. We model GPs as partially altruistic, and compete for patients. We show that a GP operating in a more competitive market refers more. To retain patients in his practice, a GP satisfies patients’ requests for referrals. Furthermore, a GP who faces patient shortage will refer more often than a GP who has enough patients. More referrals may add to profits from future treatments. Using data of radiology referrals by GPs in Norway, we test and confirm our theory.

Keywords: Physician; service motive; profit motive; referral; radiology (search for similar items in EconPapers)
JEL-codes: C23 H42 I11 I18 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2009-12-14
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http://www.hero.uio.no/publicat/2009/2009_8.pdf (application/pdf)

Related works:
Journal Article: Market conditions and general practitioners’ referrals (2011)
Working Paper: Market conditions and general practitioners’ referrals (2010)
Working Paper: Market Conditions and General Practitioners' Referrals
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