Mechanism Design Applications in the Study of Healthcare Payment Contract Design
陈友华(City University of Hong Kong, College of Business)
In the public healthcare system and healthcare service market, there exists a complex principal-agent relationship between "doctors, patients and insurers". The cost of healthcare and the quality of healthcare services are two key issues in healthcare reforms, and healthcare providers usually have the most control over the treatment plan, quantity and quality that directly affect the cost. Not only is the full input/effort of healthcare services difficult to observe, but also the outcome of the output is difficult to objectively measure. Therefore, designing incentives to ensure the quality of care while controlling the cost of care is a "world problem", centred on how to reasonably reimburse providers (doctors, hospitals, etc.) for their care, i.e., the payment mechanism. In the process of diagnosis and treatment, medical institutions have the greatest information asymmetryadvantage. Therefore, considering the information advantage of healthcare providers is crucial to the design of the payment mechanism. Mechanism design is the study of how to design a set of mechanisms - rules or systems - to achieve a certain goal in a situation of incomplete information and voluntary choices made by individuals based on their own rationality. This report explores the application of mechanism design theory to the study of healthcare incentive design. The focus is on the public healthcare system: policymakers develop payment mechanisms and healthcare delivery models to pay providers through health insurance for the healthcare services they provide to patients. This talks presents a set of results from our team exploring healthcarepayment mechanism research through principal-agent relationship-information asymmetry modelling.It is expected to shed light on healthcare reform research.
Prof. CHEN Youhua (Frank) is currently Chair Professor of Management Science, at College of Business, CityUniversity of Hong Kong. His current research interests span from healthcare operations management, logistics-supply chain management, to data-driven operations. He has just completed a large research project on healthcare management and undertaking another project of similar scale focusing on a new elderly care model (supported by the BOCHK Centenary Charity Programme).Hispublications appear in Operations Research, Management Science, POM, IEEE, and other journals. He teaches on Operations Management, Supply Chain Management, and Logistics Management.