INCENTIVES IN THE HEALTH-CARE MARKET

The characteristics of the >>market<< for health care services compared with the standard assumptions of the model of perfect competition are developed in sections I-IV In particular the existence of risk, uncertainty, market failures in insurance markets, specific caring with respect to health care and the predominant asymmetric information between consumer and provider are emphasized and their implications analyzed. Based on an analysis of the supply side of the health care market health policy is defined as measures intended to influence the behaviour of the economic units producing health care status. Following a discussion of >>price setting<< in a regulated >>market<<, the paper develops and discusses the recent plan of the Danish Ministry of Health compared to the American ideas of Health Maintenance Organizations.