Some other result of Glazer and you can McGuire’s (2002) design is that the degree to which a profit-maximizing merchant reacts so you’re able to changes in Medicare payments are a purpose of the personal/private payer combine. The greater number of a beneficial hospital’s show away from societal customers, the more power your changes in societal percentage policy tend to provides.
Wu (2009) conditions Glazer and you can McGuire’s “reverse causality” story (one societal prices respond to individual costs) a beneficial “strategy” theory in the same way you to societal payers work strategically inside the setting pricing. On the other hand, she labels the greater number of simple story-one hospitals that have unexploited ;while the “markets fuel” theory. These hypotheses recommend an alternative consequence of payer mix. According to market stamina theory, healthcare facilities that have a more impressive show of private clients perform pricing change a great deal more because of their greater negotiating power. On the other hand, the strategy hypothesis suggests that healthcare facilities which have a larger share regarding individual customers do pricing change smaller because they are shorter delicate so you can (faster based upon on) social money. Continue reading “A heightened share regarding private repayments dilutes whatever affect top quality the policy shift in public areas money have”