Contracts and purchaser-provider relationships in community care.
This paper considers the incentives embodied in contracts between purchasers and providers of residential care for frail elderly people. The paper begins with an assessment of current contractual arrangements. A theoretical inquiry generates propositions that some contracts create incentives for providers to misrepresent users' characteristics. These propositions are found to be supported by sample data. The paper then turns to a theoretical consideration of optimal governance structures and, in particular, the use of incentive contracts. These contracts, it is claimed, may go some way to curbing cost-exaggerating behaviour without providing strong incentives to cream-skim or shirk on quality.
Forder
J
J
London School of Economics and Political Science, London, UK.
D000368:Aged; D003153:Community Health Services / Q000191:economics / Q000458:organization & administration* / Q000706:statistics & numerical data; D003284:Contract Services / Q000191:economics / Q000458:organization & administration*; D016330:Frail Elderly; D019981:Health Care Sector / Q000706:statistics & numerical data; D006302:Health Services Research / Q000379:methods; D006707:Homes for the Aged / Q000191:economics / Q000458:organization & administration* / Q000706:statistics & numerical data; D006801:Humans; D015233:Models, Statistical; D018579:Patient Selection; D011907:Rate Setting and Review; D012052:Reimbursement, Incentive; D013222:State Medicine; D006113:United Kingdom