Ellis R, (1998)
‘Creaming, Skimping and Dumping: Provider Competition on the Intensive and Extensive Margins’
Journal of Health Economics 17, pp. 537-555
- Theoretical paper modelling the effect of competition and differing payment systems on healthcare providers.
- Examines 3 different strategies a provider might adopt in response to different incentives:
1. Creaming: over-provision of services to low cost patients.
2. Skimping: under-provision of services to high cost patients.
3. Dumping: explicit avoidance of high cost patients.
- The model involves two healthcare providers competing to attract patients.
- In this model cash-based reimbursement results in overprovision of services (creaming) to all types of patients.
- Prospectively paid providers cream low severity patients and skimp on high severity ones. If there is dumping of high severity patients, then there will also be skimping.
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