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TitleHow does the type of remuneration affect physician behaviour? Fixed salary versus fee-for-service
Author(s)Brekke, Kurt R.
Holmås, Tor Helge
Monstad, Karin
Straume, Odd Rune
Primary care
Fixed salary
Issue date2018
PublisherUniversidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)
JournalNIPE Working Paper
Abstract(s)We analyse the effects of two different types of physician remuneration - fee-for-service and fixed salary on the treatment decisions of general practitioners (GPs) and on patients´ health outcomes. Using rich Norwegian register data during the period 2009-2013,we focus on GP locums working in a succession of temporary positions, which allows us to observe the same GPs working under different remuneration schemes within a relatively short period of time. We find that GPs respond strongly and consistently to changes in remuneration type. Compared with fixed salary, GP payment by fee-for-service leads to an increase in the supply of consultations and a higher provision of medical services (along several dimensions) per consultation. This has also signiffcant implications for patients´health outcomes. The probability of experiencing an emergency admission to hospital shortly after a GP consultation is close to 20 percent lower if the GP is paid by fee-for-service instead of fixed salary. Overall, our analysis suggests that fixed-salary remuneration leads to underprovision of primary care.
TypeWorking paper
Publisher version
AccessOpen access
Appears in Collections:NIPE - Documentos de Trabalho

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