TY  - BOOK
AU  - Frandsen,Brigham
AU  - Powell,Michael
AU  - Rebitzer,James B.
ED  - National Bureau of Economic Research.
TI  - Sticking Points: Common-Agency Problems and Contracting in the U.S. Healthcare System 
T2  - NBER working paper series
PY  - 2017///
CY  - Cambridge, Mass.
PB  - National Bureau of Economic Research
N1  - February 2017; Hardcopy version available to institutional subscribers
N2  - We propose a "common-agency" model for explaining inefficient contracting in the U.S. healthcare system. In our setting, common-agency problems arise when multiple payers seek to motivate a shared provider to invest in improved care coordination. Our approach differs from other common-agency models in that we analyze "sticking points," that is, equilibria in which payers coordinate around Pareto-dominated contracts that do not offer providers incentives to implement efficient investments. These sticking points offer a straightforward explanation for three long observed but hard to explain features of the U.S. healthcare system: the ubiquity of fee-for-service contracting arrangements outside of Medicare; problematic care coordination; and the historic reliance on small, single specialty practices rather than larger multi-specialty group practices to deliver care. The common-agency model also provides insights on the effects of policies, such as Accountable Care Organizations, that aim to promote more efficient forms of contracting between payers and providers
UR  - https://www.nber.org/papers/w23177
UR  - http://dx.doi.org/10.3386/w23177
ER  -