Abstract

Traditional health economics assumes that the patient should always consult a primary cone pshysician to get information on his condition and on the type of care suitable for him. This framework is no longer able to capture the actual world because GP's play a marginal role as therapist, their role evolving into gatekeepers and /or an information channel, and patients are (or they think they are) better informed than in the past. Asymmetry of information, incentives and patients' choices should be taken into account when the payment scheme is put in force for physicians. In the literature a long debate has developed about the best method of payment to be used and the most recent contributions seems to be oriented towards a mixed payment scheme as the one proposed by Levaggi and Rochaix (2003). The validity of these theoretical contributions is not in discussion, but most of this literature has not taken into account the role of the patient and his choice. If, as the recent literature suggests, the patient has information on his condition, forms of horizontal competition between GP's and specialists can be developed to reduce the cost of asymmetry of information. The aim of the paper is to show how forms of payment and the organisation of the service interact when the patient can make choices between GP's and specialists. The interesting result of our analysis is that systems of organisation and payment allowing the patient to choose, even if he has not got any prior on his disease, reduces the monopoly power of the GP hence the cost of treatment for society.