We analytically characterize the effects of ownership and competition in the healthcare industry on quality provision, market coverage and optimal reimbursement policy. A for-profit monopoly selects a lower quality than a nonprofit supplier, and the socially optimal reimbursement rate with a nonprofit monopoly exceeds that with a for-profit monopoly. We establish that the optimal repayment policy is invariant to the introduction of competition by a for-profit high-quality supplier. Thus, market coverage is invariant to the introduction of competition, whereas consumers with a higher willingness to pay for quality are better off with competition.
|Referentgranskad vetenskaplig tidskrift||The B.E. Journal of Economic Analysis & Policy|
|Status||Publicerad - 23.01.2018|
|MoE-publikationstyp||A1 Originalartikel i en vetenskaplig tidskrift|
- 511 Nationalekonomi