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Physician Agency
• Asymmetric Information
– Prinicpals (Patients)
– Agents (Physicians)
• Perfect versus imperfect agency.
– If you could know everything the doctor knows,
what would you do?
Market For Physician Services
• Monopolistic Competition
Market For Physician Services
• Price Discrimination versus Cost Shifting
Market For Physician Services
• Physician Altruism
Physicians as Quantity Setters
Physician Induced Demand (SID)
• evidence
Physician Behavior in Age of Managed
• Reimbursement Methods
– Capitation based pay
– Salary and
– Revenue sharing
Medical Malpractice
• Defensive Medicine
Trends in Premiums for Physicians' Medical Malpractice
Insurance, by Type of Physician, 1993 to 2002