IDEAS home Printed from https://ideas.repec.org/a/spr/hecrev/v7y2017i1d10.1186_s13561-017-0156-4.html
   My bibliography  Save this article

Overcoming resistance against managed care – insights from a bargaining model

Author

Listed:
  • Andree Ehlert

    (Leuphana University of Lueneburg)

  • Thomas Wein

    (Leuphana University of Lueneburg)

  • Peter Zweifel

    (Leuphana University of Lueneburg)

Abstract

Recent healthcare reforms have sought to increase efficiency by introducing managed care (MC) while respecting consumer preferences by admitting choice between MC and conventional care. This article proposes an institutional change designed to let German consumers choose between the two settings through directing payments from the Federal Health Fund to social health insurers (SHIs) or to specialized MC organizations (MCOs). To gauge the chance of success of this reform, a game involving a SHI, a MCO, and a representative insured (RI) is analyzed. In a “three-player/three-cake” game the coalitions {SHI, MCO}, {MCO, RI}, and {SHI, RI} can form. Players’ possibility to switch between coalitions creates new outside options, causing the conventional bilateral Nash bargaining solution to be replaced by the so-called von Neumann-Morgenstern triple. These triples are compared to the status quo (where the RI has no threat potential) and related to institutional conditions characterizing Germany, the Netherlands, and Switzerland.

Suggested Citation

  • Andree Ehlert & Thomas Wein & Peter Zweifel, 2017. "Overcoming resistance against managed care – insights from a bargaining model," Health Economics Review, Springer, vol. 7(1), pages 1-15, December.
    • Handle: RePEc:spr:hecrev:v:7:y:2017:i:1:d:10.1186_s13561-017-0156-4
    DOI: 10.1186/s13561-017-0156-4
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1186/s13561-017-0156-4
    File Function: Abstract
    Download Restriction: no
    File URL: https://libkey.io/10.1186/s13561-017-0156-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Peter Zweifel & Harry Telser & Stephan Vaterlaus, 2006. "Consumer Resistance Against Regulation: The Case of Health Care," Journal of Regulatory Economics, Springer, vol. 29(3), pages 319-332, May.
    2. Nash, John, 1953. "Two-Person Cooperative Games," Econometrica, Econometric Society, vol. 21(1), pages 128-140, April.
    3. Kifmann, Mathias & Nell, Martin, 2013. "Fairer Systemwettbewerb zwischen gesetzlicher und privater Krankenversicherung," hche Research Papers 06, University of Hamburg, Hamburg Center for Health Economics (hche).
    4. Callahan, Daniel, 2008. "Consumer-directed health care: promise or puffery?," Health Economics, Policy and Law, Cambridge University Press, vol. 3(3), pages 301-311, July.
    5. Gre[ss], Stefan & Focke, Axel & Hessel, Franz & Wasem, Jurgen, 2006. "Financial incentives for disease management programmes and integrated care in German social health insurance," Health Policy, Elsevier, vol. 78(2-3), pages 295-305, October.
    6. R. Halbersma & M. Mikkers & E. Motchenkova & I. Seinen, 2011. "Market structure and hospital–insurer bargaining in the Netherlands," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 12(6), pages 589-603, December.
    7. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    8. Peter Zweifel, 2013. "Managed Care: Prescription for Failure? Lessons from Switzerland," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 11(1), pages 27-31, 04.
    9. Markus Wörz & Reinhard Busse, 2005. "Analysing the impact of health‐care system change in the EU member states – Germany," Health Economics, John Wiley & Sons, Ltd., vol. 14(S1), pages 133-149, September.
    10. Peter Zweifel & Roland Eisen, 2012. "The Supply of Insurance," Springer Texts in Business and Economics, in: Insurance Economics, edition 127, chapter 6, pages 205-263, Springer.
    11. Luigi Siciliani & Anderson Stanciole, 2013. "Bargaining and the provision of health services," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(3), pages 391-406, June.
    12. Wynand P. M. M. Van de Ven & Frederik T. Schut, 2009. "Managed competition in the Netherlands: still work‐in‐progress," Health Economics, John Wiley & Sons, Ltd., vol. 18(3), pages 253-255, March.
    13. Asami, Yasushi, 1985. "A game-theoretic approach to the division of profits from economic land development," Regional Science and Urban Economics, Elsevier, vol. 18(2), pages 233-246, May.
    14. repec:ces:ifodic:v:11:y:2013:i:1:p:19078507 is not listed on IDEAS
    15. Trottmann, Maria & Zweifel, Peter & Beck, Konstantin, 2012. "Supply-side and demand-side cost sharing in deregulated social health insurance: Which is more effective?," Journal of Health Economics, Elsevier, vol. 31(1), pages 231-242.
    16. Thomson, Sarah & Busse, Reinhard & Crivelli, Luca & van de Ven, Wynand & Van de Voorde, Carine, 2013. "Statutory health insurance competition in Europe: A four-country comparison," Health Policy, Elsevier, vol. 109(3), pages 209-225.
    17. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
    18. Peter Zweifel, 2013. "Managed Care: Prescription for Failure? Lessons from Switzerland," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 11(01), pages 27-31, April.
    19. Brooks, John M. & Dor, Avi & Wong, Herbert S., 1997. "Hospital-insurer bargaining: An empirical investigation of appendectomy pricing," Journal of Health Economics, Elsevier, vol. 16(4), pages 417-434, August.
    20. Gallo, Pedro & Gené-Badia, Joan, 2013. "Cuts drive health system reforms in Spain," Health Policy, Elsevier, vol. 113(1), pages 1-7.
    21. Okma, Kieke G.H. & Crivelli, Luca, 2013. "Swiss and Dutch “consumer-driven health care”: Ideal model or reality?," Health Policy, Elsevier, vol. 109(2), pages 105-112.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Vaidya, Shalvaree, 2021. "The impact of premium subsidies on health plan choices in Switzerland: Who responds to the incentives set by in-kind as opposed to cash transfers?," Health Policy, Elsevier, vol. 125(6), pages 675-684.
    2. Zweifel, Peter, 2021. "Innovation in health care through information technology (IT): The role of incentives," Social Science & Medicine, Elsevier, vol. 289(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Peter Zweifel, 2013. "Managed Care: Prescription for Failure? Lessons from Switzerland," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 11(01), pages 27-31, April.
    2. Feltovich, Nick & Swierzbinski, Joe, 2011. "The role of strategic uncertainty in games: An experimental study of cheap talk and contracts in the Nash demand game," European Economic Review, Elsevier, vol. 55(4), pages 554-574, May.
    3. Akira Okada, 2015. "Cooperation and Institution in Games," The Japanese Economic Review, Japanese Economic Association, vol. 66(1), pages 1-32, March.
    4. Roger A McCain, 2013. "Value Solutions in Cooperative Games," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 8528, October.
    5. Krishnan, Ranjani, 2001. "Market restructuring and pricing in the hospital industry," Journal of Health Economics, Elsevier, vol. 20(2), pages 213-237, March.
    6. Crespi, John M. & James, Jennifer S., 2007. "Bargaining rationale for cooperative generic advertising," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(4), pages 1-13.
    7. Kyriazi, Zacharoula & Lejano, Raul & Maes, Frank & Degraer, Steven, 2015. "Bargaining a net gain compensation agreement between a marine renewable energy developer and a marine protected area manager," Marine Policy, Elsevier, vol. 60(C), pages 40-48.
    8. Peter Zweifel, 2013. "Managed Care: Prescription for Failure? Lessons from Switzerland," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 11(1), pages 27-31, 04.
    9. Grepperud, Sverre & Pedersen, Pål Andreas, 2020. "Positioning and negotiations: The case of pharmaceutical pricing," European Journal of Political Economy, Elsevier, vol. 62(C).
    10. Suchan Chae & Seho Kim, 2019. "The effects of third-party transfers in sequential anchored bargaining," International Journal of Game Theory, Springer;Game Theory Society, vol. 48(1), pages 143-155, March.
    11. Peter Zweifel, 2022. "Preference measurement in health using experiments," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 30(1), pages 49-66, March.
    12. Luigi Siciliani & Anderson Stanciole, 2013. "Bargaining and the provision of health services," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(3), pages 391-406, June.
    13. Maurus Rischatsch & Peter Zweifel, 2013. "What do physicians dislike about managed care? Evidence from a choice experiment," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(4), pages 601-613, August.
    14. Peter Zweifel, 2022. "Health economics explained through six questions and answers," Economic Affairs, Wiley Blackwell, vol. 42(1), pages 50-69, February.
    15. Scharpf, Fritz W., 1991. "Koordination durch Verhandlungssysteme: Analytische Konzepte und institutionelle Lösungen am Beispiel der Zusammenarbeit zwischen zwei Bundesländern," MPIfG Discussion Paper 91/4, Max Planck Institute for the Study of Societies.
    16. Kenneth Arrow, 1970. "Political and Economic Evaluation of Social Effects and Externalities," NBER Chapters, in: The Analysis of Public Output, pages 1-30, National Bureau of Economic Research, Inc.
    17. repec:ces:ifodic:v:11:y:2013:i:1:p:19078507 is not listed on IDEAS
    18. Fritz W. Scharpf, 1989. "Decision Rules, Decision Styles and Policy Choices," Journal of Theoretical Politics, , vol. 1(2), pages 149-176, April.
    19. Guth, Werner & Ritzberger, Klaus & van Damme, Eric, 2004. "On the Nash bargaining solution with noise," European Economic Review, Elsevier, vol. 48(3), pages 697-713, June.
    20. Wen Li Cheng & Jeffrey Sachs & Xiaokai Yang, 2005. "An Inframarginal Analysis Of The Ricardian Model," World Scientific Book Chapters, in: An Inframarginal Approach To Trade Theory, chapter 6, pages 87-107, World Scientific Publishing Co. Pte. Ltd..
    21. Volodymyr Babich & Simone Marinesi & Gerry Tsoukalas, 2021. "Does Crowdfunding Benefit Entrepreneurs and Venture Capital Investors?," Manufacturing & Service Operations Management, INFORMS, vol. 23(2), pages 508-524, March.

    More about this item

    Keywords

    Managed care; Game theory; Multilateral Nash bargaining; Health insurance; Consumer choice; Healthcare reform; Germany; The Netherlands; Switzerland;
    All these keywords.

    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:hecrev:v:7:y:2017:i:1:d:10.1186_s13561-017-0156-4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com/economics/journal/13561 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.