Wednesday, June 28, 2006


Incentive structure

How strong are the incentives for a doctor to "cure" a patient? Assuming there is assymetric information, it would be difficult to measure the quality of the doctor and whether or not they are taking you down the Road to Wellville. It seems unlikely that a doctor would want you to be deathly ill at any point in time, but would likely prefer to maintain a chronic disease or atleast something that keeps you coming back for their expertise. I don't know how strong the current (or past) incentive structure is (was) for doctors to cure patients, but I wonder how the current insurance and welfare systems influence (distort) that incentive structure. Any thoughts?

This actually reminds me of the line from Thank you for smoking, where Nick Naylor is on a TV talk show with 'cancer boy' and tells the audience that Big Tobacco doesn't want to see this kid die, rather they want him to live a long life as a smoker.

This all came to mind from an email from the HR department about a change in benefits for Mental Health and Substance Abuse Benefits. Two questions: What incentive do either mental health or substance abuse facilities have to "cure" their patients? How many people take a look at the rates of successful treatments before checking in?

Comments: Post a Comment

<< Home
CrispAds Blog Ads

Does someone you know deserve flowers?
Web Site Hit Counter
Dell Canada

This page is powered by Blogger. Isn't yours?