The Design Of Medical Treatment Service Pricing Mechanism Under Asymmetric Information

Under the current medical system in China, the prescription fee and the second phase of treatment fees resulting from initial treatment does not cure that should closely related to the doctor effort level and technical level,(including prescription charges and treatment fees in the second phase) are borne by the patients.Risk cost of treatment objectively is the superposition of endogenous risk of the doctor and exogenous risk of the patient, so it is obviously unreasonable that the risk cost of treatment shall be fully assumed by patients. In view of the irrationality in the existing health care system, we divide patient’s treatment into two periods. Start from a package treatment contract, risk cost of treatment assumed by the doctor is transferred back to the patient according to insurance regulations, and then the price of a package treatment contract price minus the premium is the price of medical services.Firstly, this paper establishes a one-phase medical services pricing model to study the principal-agent behavior of doctors and patients under symmetric information. There is no moral hazard and adverse selection, the doctor’s skill level and effort level can be observed. In the absence of doctor’s moral risk, the optimal medical service pricing model can achieve the Pareto optimal risk sharing.Secondly, the one-phase medical service pricing pure moral hazard models are established to investigate the principal-agent behavior of doctors and patients. There are two situations:the doctor effort level is discrete and continuous type, the doctor’s level of effort cannot be observed by patients. In the existence of moral risk, the physician must bear a certain proportion of risk, and the premium which doctors return to patients is less than the expectations of risk cost of treatment.Thirdly, the one-phase medical service pricing pure adverse selection models are established to investigate the principal-agent behavior of doctors and patients. There are two situations:the doctor’s skill level is discrete and continuous type, the doctor’s skill level cannot be observed by patients. In the existence of adverse selection, the physician must bear a certain proportion of risk, and the premium which doctors return to patients is less than the expectations of risk cost of treatment. The optimal medical pricing of the doctor is a monotone increasing function of his skill level.Finally, the one-phase medical service pricing mixture model is established to investigate the principal-agent behavior of doctors and patients. The doctor’s skill level and effort level cannot be observed by patients, in the existence of morale hazard and adverse selection, the physician must bear a certain proportion of risk, and the premium which doctors return to patients is less than the expectations of risk cost of treatment. The optimal medical pricing of the doctor is a monotone increasing function of his skill level. For a specific skill level, the optimal effort level of the doctor under both moral hazard and adverse selection are existed is strictly less than optimal effort level under moral hazard is existed, and his utility is also lower.