Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/288300 
Year of Publication: 
2020
Citation: 
[Journal:] The European Journal of Health Economics [ISSN:] 1618-7601 [Volume:] 22 [Issue:] 1 [Publisher:] Springer [Place:] Berlin, Heidelberg [Year:] 2020 [Pages:] 101-114
Publisher: 
Springer, Berlin, Heidelberg
Abstract: 
This paper examines the behaviour of mental health care providers in response to marginal payment incentives induced by a discontinuous per diem reimbursement schedule with varying tariff rates over the length of stay. The analyses use administrative data on 12,627 cases treated in 82 psychiatric hospitals and wards in Germany. We investigate whether substantial reductions in marginal reimbursement per inpatient day led to strategic discharge behaviour once a certain length of stay threshold is exceeded. The data do not show gaps and bunches at the duration of treatment when marginal reimbursement decreases. Using logistic regression models, we find that providers did not react to discontinuities in marginal reimbursement by significantly reducing inpatient length of stay around the threshold. These findings are robust in terms of different model specifications and subsamples. The results indicate that if regulators aim to set incentives to decrease LOS, this might not be achieved by cuts in reimbursement over LOS.
Subjects: 
Health care financing
Prospective payment system
Length of stay
Marginal payment incentives
Hospital behaviour
Mental health care
Analysis of health care markets (I11)
Government policy
Regulation
Public health (I18)
Persistent Identifier of the first edition: 
Creative Commons License: 
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Document Type: 
Article
Document Version: 
Published Version

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