Background: By performing case management, general practitioners and health care assistants can provide additional benefits to their chronically ill patients. However, the economic effects of such case management interventions often remain unclear although how to manage the burden of chronic...

We examine the strategic interaction in the market for physician services when the total budget for reimbursement is fixed. We show that this prospective payment system involves - compared to a fee-for-service remuneration system - a severe coordination problem, which potentially leads to the...