Hospital non-price competition under the Global Budget Payment and Prospective Payment Systems

摘要

This paper provides theoretical analyses of two alternative hospital payment systems forncontrolling medical cost: the Global Budget Payment System (GBPS) and the ProspectivenPayment System (PPS). The former method assigns a fixed total budget for all healthcarenservices over a given period with hospitals being paid on a fee-for-service basis. The latternmethod is usually connected with a fixed payment to hospitals within a Diagnosis-RelatednGroup. Our results demonstrate that, given the same expenditure, the GBPS wouldnapproach optimal levels of quality and efficiency as well as the level of social welfarenprovided by the PPS, as long as market competition is sufficiently high; our results alsondemonstrate that the treadmill effect, modeling an inverse relationship between price andnquantity under the GBPS, would be a quality-enhancing and efficiency-improving outcomendue to market competition.