Innovation in healthcare contracting models. Where are we heading?

By: Diego Rosselli

As every student in a health economics introductory course learns in the first few days, healthcare provision is a very atypical market. Demand for healthcare behaves in all sorts of particular ways. To quote the Economics Nobel prize winner Kenneth Arrow in his 1963 seminal paper: “The most obvious distinguishing characteristics of an individual’s demand for medical services is that it is not steady in origin as, for example, for food or clothing, but irregular and unpredictable.” (1)

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