2008
DOI: 10.1007/s10754-008-9034-2
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The optimal negligence standard in health care under supply-side cost sharing

Abstract: This paper elaborates on the optimal negligence standard in a world where physicians choose their level of care subject to erroneous court judgements and to the degree of supply-side cost sharing. Uncertain liability in malpractice lawsuits leads physicians to provide excessive and insufficient care, which results in a loss of social welfare. The standard that maximizes welfare depends on the cost share: Under traditional, close to full cost reimbursement it is lower than the first-best level of care, while un… Show more

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Cited by 4 publications
(1 citation statement)
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References 29 publications
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“…Many recent economic models of health worker behavior take a more differentiated view of factors explaining health worker behavior(Encinosa, Gaynor, & Rebitzer, 2007;R. G. Frank & Zeckhauser, 2007;Olbrich, 2008;Schneider & Ulrich, 2008).…”
mentioning
confidence: 99%
“…Many recent economic models of health worker behavior take a more differentiated view of factors explaining health worker behavior(Encinosa, Gaynor, & Rebitzer, 2007;R. G. Frank & Zeckhauser, 2007;Olbrich, 2008;Schneider & Ulrich, 2008).…”
mentioning
confidence: 99%