Siciliani L, (2005)

‘Does More Choice Reduce Waiting Times?’

Health Economics 14: 17–23

• Models the effect of increased patient choice on the supply of elective hospital treatment in a duopolistic market structure. It is shown that increasing patient choice may actually increase waiting times.
• The intuition is as follows: if a hospital reduces waiting times (by increasing supply) when patients have a lot of choice, it attracts more patients from other hospitals. The higher demand generates upward pressure on waiting times that eliminates the benefit from higher supply.
• This result is found to be robust to different funding mechanisms. It is most pronounced when hospitals are given a fixed budget, and diminished slightly by activity-based funding.

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