Compensation and competition

Einleitung / Introduction

In this project, we examine whether the gender of primary care providers (PCPs) affects patients’ health care utilization and whether PCPs discriminate between male and female patients in the type of care they provide. We focus on PCPs as they are the first point of contact for patients in case of an illness and as they provide regular care for chronic ill patients.

Methode / Method

We exploit a unique quasi-random procedure for filling vacant outpatient physician positions in Upper Austria to causally analyze the effect of a general practitioner’s (GP’s) gender on individual health care utilization. In this setting, patients have no influence on the substitution process. Furthermore, we show that, conditional on other observed physician characteristics, female substitutes do not self-select into certain positions. In the empirical analysis, we compare patients who have been with their male PCP for at least two years before the exit and who are now exogenously treated by either a female or a male PCP in a difference-in-differences (DID) design.

Ergebnisse / Results

First, we show that patients in practices with female successors are significantly more likely to move to other PCPs than patients in practices with male successors. The results vary with the type of transition and patient characteristics. We then analyze expenditure trends and changes in patients' health care utilization. We find a significant and quantitatively relevant decrease in PCP fees per patient in practices with a female PCP successor. Combined with the effect of more patients leaving practices with a female successor, this implies that female PCPs experience a decrease in physician fees. The reduction in preventive care caused by a female PCP successor suggests that male and female PCPs differ in obtaining information on the health status of their patients, regardless of differences in preferences about the effectiveness of medical screening. Overall, the quantitative effects on health care utilization are small, which is plausible in the context of a highly regulated outpatient health care system.

Zusammenfassung / Conclusion

We conclude that the final assessment of supply-side gender effects on health care utilization requires a convincing identification strategy and consideration of the economic incentives imposed by real health care systems.

Authors

Katrin Zocher, Johannes Kepler University

Flora Stiftinger, Johannes Kepler University

Gerald Pruckner, Johannes Kepler University

Einleitung / Introduction

In many healthcare systems, including the United Kingdom, General Practitioners (GPs) act as gatekeepers who inherit a special function, as they by default constitute the first point of contact for patients in the event of illness or need for medical care. For this reason alone, the quality of the service rendered to patients by primary care providers is a central issue from an economic and socio-political point of view. However, given the existing economic analysis of competitive behavior in healthcare markets, research generally tends to concentrate on hospital markets, indicating that the behavior of GPs under competition is an aspect that is (still) fundamentally underexposed.

Methode / Method

Using a rich panel of the entirety of all GP Practices (N=7,300) in England from 2015-2019, right before the onset of Covid-19, we analyze the link between GP competition and GP quality. Using data from the quality and outcomes (“QOF”) framework, which essentially is a pay-for- performance component of GP renumeration in England, allows us to construct several metrics with respect to GP quality. GP competition is measured via a (population-weighted) Herfindahl-Hirschman-Index (“HHI”) and built upon predicted, rather than observed, patient-practice flows within a Dirichlet regression framework. Given the exogeneous nature of the competition metric, we can draw causal inferences from our two-way fixed effects models. In addition, we examine whether the competitive environment a GP operates in causally impacts patient recommendation rates, which would indicate an elevated effort on behalf of GPs to adequately address patient needs in more contested markets, thereby acting as a means to increase patient referrals. We contrast our results to findings brought forward in the literature using conceptually different metrics and methodical approaches to capture competitive effects. Also, based on the assumption that GP markets constitute geographically localized markets, we investigate whether there are differences with respect to geographical regions, say London vs. all of England.

Ergebnisse / Results

Preliminary results indicate that more contested GP markets coincide with higher GP quality as measured via QOF based metrics, which indicates that GPs sensitively adapt to competitive pressure, which gives rise to several implications from a policy perspective.

Zusammenfassung / Conclusion

The mechanisms for increases in QOF based quality metrics in more contested markets remain to be explored.

Authors

David Simón Jonathan Anchu Probst, Institute of Health Economics | Leibniz University Hannover

Einleitung / Introduction

From the mid-1990s several countries have introduced elements of regulated competition in healthcare. In an earlier paper we assessed the extent to which the most important preconditions for achieving efficiency and affordability in competitive healthcare markets were fulfilled in Belgium, Germany, Israel, the Netherlands and Switzerland in the year 2012. This paper deals with the situation ten years later: to what extent are these preconditions fulfilled in 2022?

Methode / Method

We assess the extent to which ten preconditions that are derived from the theoretical model of regulated competition in healthcare, are fulfilled in Belgium, Germany, Israel, the Netherlands and Switzerland in 2022. We do this by (1) providing a description of changes during the period 2012-2022 in each precondition for each of the five countries based on scholarly literature, relevant policy documents and other relevant sources; (2) after that giving a subjective 2022-rating by each author for each precondition for each of the five countries; (3) averaging these subjective ratings.

Ergebnisse / Results

In the analysis we derived (among others based on the work by Enthoven on regulated competition) the following ten preconditions to achieve efficiency and affordability in health care systems: 1. Free consumer choice of insurer 2. Consumer information and market transparency 3. Risk-bearing buyers and sellers 4. Contestable markets 5. Freedom to contract and integrate 6. Effective competition regulation 7. Cross-subsidies without incentives for risk selection 8. Cross-subsidies without opportunities for free riding 9. Effective quality supervision 10. Guaranteed access to basic care. In Belgium the government has decreed (by law of 30 May 2022) to give up the whole system of individual financial responsibility for health insurers and to replace this by collective responsibility. In 2022 the idea of regulated competition in health care, which was never strongly supported, seems to be completely abandoned in Belgian health policy. Individual insurers never received the instruments and financial incentives to become a purchaser of care. This illustrates that in the 1990s the ‘financial responsibility’ for the Belgian social health insurers has been introduced without any open discussion about the implications this would/should have for the way of structuring and organizing the healthcare system. In Israel in the last decade there were improvements in the preconditions for efficiency, e.g., major improvements in the public provision of consumer information about both health insurance products and medical services. By contrast, however, the preconditions for affordability worsened. Universal guaranteed access to good, timely care seems to exist more on paper and in principle than in reality. Due to a lack of substantial improvements in the Israeli risk equalization formula, there are still large incentives for risk selection, resulting in adverse effects. A major negative selection effect is the distortion of the competition among the insurers on the availability and quality of care [44] and the level of copayments. Although the Israeli healthcare system has often been characterized as ‘managed competition’, this is not the type of managed competition in healthcare as described in the literature [3-4], because the essential preconditions ‘effective competition policy’ and ‘contestability of the markets’ are not fulfilled in 2022, just as in 2012. In Germany and Switzerland, the essential preconditions ‘effective competition policy’, ‘contestability of the markets’ and ‘freedom to contract and integrate’ are not sufficiently fulfilled in 2022, just as in 2012. One may wonder whether this is a (long) interim-period towards regulated competition or whether it is going to be the long-term status quo. In the latter case one may doubt whether this is a sustainable model of health care organization. The rationale of regulated competition in healthcare is that individual insurers have the primary responsibility for delivering or purchasing care. There seems to be no rationale for allowing consumer choice among risk bearing insurers if insurers cannot distinguish themselves as individual purchasers of care. In the Netherlands there is much debate about the question to what extent competing healthcare providers are allowed to cooperate with each other and whether the provision of health care should be more ‘regionalized’. The ACM, the Dutch competition authority, has clearly indicated that such cooperation is allowed if the consumer substantially benefits from this cooperation. Nevertheless, under public and political pressure the role and effectiveness of the Dutch competition regulation in health care has been slightly reduced.

Zusammenfassung / Conclusion

In sum, in the period 2012-2022 on balance there have been some improvements in the fulfillment of the preconditions for regulated competition, although to a different extent in the five countries in this study. For Belgium these preconditions no longer seem relevant because the idea of regulated competition has been completely abandoned. In three of the other four countries some essential preconditions are not sufficiently fulfilled, just as 2012. Overall, the progress towards realizing the preconditions for regulated competition has been limited. There are several potential explanations for this limited progress. First, technical complexity may play a role, e.g., in the development of an adequate risk equalization system. Second, there might be resistance by interest groups, e.g., the providers of care who oppose a competitive health care market and selective contracting by the insurers [59] and oppose the publication of comparable information about the quality of care at the level of individual providers of care. Third, there may be a lack of unequivocal political support for the model of regulated competition, which might be partly explained by the limited empirical evidence showing that this model would outperform others. However, it is methodologically very hard to provide such convincing empirical evidence, even if all preconditions would be fulfilled. In addition, we do not know what level of non-fulfillment is acceptable to achieve reasonable levels of efficiency and affordability in health care, which also depends on the local context and the prevailing social norms and values. However, this lack of empirical evidence is not unique for the model of regulated competition, it also holds for other models of structuring and organizing the health care system.

Authors

Wynand van de Ven, Erasmus University Rotterdam; The Netherlands

Konstantin Beck, University of Luzern, Switzerland

Florian Buchner, CINCH, University Duisburg-Essen, Germany

Erik Schokkaert, Catholic University Leuven. Belgium

F.T. Erik Schut, Erasmus University Rotterdam; The Netherlands

Amir Shmueli, Hebrew University, Jerusalem, Israel

Juergen Wasem, Institute for Health Care Management and Research, University Duisburg-Essen, Germany

Einleitung / Introduction

Improving healthcare quality through provider competition is a popular healthcare reform strategy. However, its effectiveness can be limited by asymmetric information between patients and physicians or by patients’ reluctance to switch their physician. This study aims to investigate the impact of different types of information on patients’ choice of a physician and physicians’ treatment behavior.

Methode / Method

Our theory-guided laboratory experiment varies whether patients receive information either about their own physician’s medical treatment decision (Flex-Base), or also about other patients’ choice of a physician (Flex-Patients), or about all physicians’ medical treatment (Flex-Physicians). In addition, we test three control conditions in which patients either always choose the physician offering the best quality of care (Fix100), only switch to the physician with the best quality of care at a 20 percent rate (Fix20), or do not switch their physician at all (Fix0).

Ergebnisse / Results

The results of the experiment reveal that providing more information to patients increases their average switching rate and, accordingly, increases physicians’ average quality of care. Even in cases where patients are informed only about the quality of care provided by their own physician, average treatment quality is higher than in cases without an opportunity to switch the physician.

Authors

Jeannette Brosig-Koch, Otto von Guericke Universität Magdeburg

Burkhard Hehenkamp, Universität Paderborn

Johanna Kokot, Universität Hamburg