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. 1985 Fall;7(1):49-60.

Containing Medicaid costs in an era of growing physician supply

P J Held, J Holahan

Containing Medicaid costs in an era of growing physician supply

P J Held et al. Health Care Financ Rev. 1985 Fall.

Abstract

In this analysis, Medicaid cost containment is viewed within the theoretical framework of a price discrimination model. The value of viewing supply decisions made by physicians in terms of the conventional economic laws of supply and demand is demonstrated. Physicians are seen to respond to prices in a predictable way. As private prices increase, physicians are less willing to participate in Medicaid. As Medicaid prices increase, physicians are more willing to participate. Effects of changes in the number of persons eligible for Medicaid and in the physician supply are also analyzed.

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Figures

Figure 1
Figure 1. Physician supply in the Medicaid and private markets
See this image and copyright information in PMC

References

    1. Hadley J. Physician participation in Medicaid: Evidence from California. Health Services Research. 1974 Winter;14:266–280. - PMC - PubMed
    1. Held PJ. Medicaid Physician Prices and Changes in Medicaid Care Use. Urban Institute; Aug. 1984. Working Paper 1403-06.
    1. Held PJ, Holahan J, Carlson C. The Effect of Medicaid and Private Fees on Physician Participation in California's Medicaid Program. Urban Institute; 1974-1978. Jan. 1983. Working Paper 1306-02-01.
    1. Holahan J. The 1981 Omnibus Budget Reconciliation Act and Medicaid Spending. Urban Institute; May, 1984. Working Paper 3155-02.