Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/76763
Authors: 
Emons, Winand
Year of Publication: 
2010
Series/Report no.: 
Discussion Papers, Department of Economics, Universität Bern 10-01
Abstract: 
We consider physicians with fixed capacity levels. If a physician's capacity exceeds demand, she may have an incentive to overtreat, i.e., she may provide unnecessary treatments to use up idle capacity. By contrast, with excess demand she may undertreat, i.e., she may not provide necessary treatments since other activities are financially more attractive. We first show that simple fee-for-service reimbursement schemes do not provide proper incentives. If insurers use, however, fee-for-service schemes with quantity restrictions, they solve the fraudulent physician problem.
Subjects: 
credence goods
expert services
incentives
medical doctors
demand inducement
insurance
JEL: 
D82
I11
Document Type: 
Working Paper

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