search query: @author Lyon, T.P. / total: 3
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Author: | Lyon, T.P. |
Title: | Quality competition, insurance, and consumer choice in health care markets |
Journal: | Journal of Economics and Management Strategy
1999 : WINTER, VOL. 8:4, p. 545-580 |
Index terms: | Health Service Markets Quality Competition Insurance Consumer choice Models |
Language: | eng |
Abstract: | In this model, insurance offering a choice of hospitals is valued because consumers are uncertain which hospital they will prefer ex-post. A competitive insurance market facilitates tacit price collusion btw. hospitals. High margins induce hospitals to compete for customers through over-investment in quality. Incentives may exist to lock in market share through managed-care plans with less choice and lower prices. As technology becomes more expensive, the market increasingly offers too little choice. A pure managed care market may emerge, with underinvestment in quality. Relative to a pure insurance regime, however, all consumers are better-off under managed care. |
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