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We consider physicians with fixed capacity levels. If a physician's capacity exceeds demand, she may have an incentive …
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behavior. These features include: (1) physicians can choose a payment contract from a menu that includes an enhanced fee … blended capitation contract; (3) physicians sort selectively into the contracts based on their preferences; and (4) physicians … in the blended capitation model provide fewer services than physicians in the enhanced fee-for-service model. …
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The discussion about health care systems focuses on the dynamics of expenditures and on the weak growth of the revenue base. In this discussion it is widely overseen that medical expenditures and supply of medical services crucially depend on the compensation of physician services. The paper...
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