Non-profit cost-adjusting with quality as a private good
Nonprofit firms that produce multiple outputs may lower service intensity for one patient group in response to lower reimbursements for another group. This is termed 'cost-adjusting' behaviour. Cost-adjusting implies a serious welfare transfer. The results of this analysis suggest that the potential for this welfare transfer exists; however, the ability of a firm to exploit this welfare transfer depends largely on the demand conditions present in the market. An empirical analysis finds evidence that nonprofit hospitals in Washington State do practise cost-adjusting.
No Reference information available - sign in for access.
No Citation information available - sign in for access.
No Supplementary Data.
Document Type: Research Article
Publication date: 2004-03-01