Abstract
This paper examines how quality for one type of preventive health care services, screening services are determined under competition and explores its links with the treatment services. A Hotelling type of model is introduced for this purpose. Two providers offer both screening and treatment services, and decide on their quality for both services. The equilibrium quality values are characterized assuming providers are identical and patients are free to choose providers for screening and treatment independently. Screening quality and treatment quality are shown to be strategic complements. The social planner can achieve the desired quality level via appropriate reimbursements for screening and treatment of the disease at early and late stage. A sensitivity analysis investigates the effect of model parameters on the equilibrium quality levels.
Similar content being viewed by others
References
Barros, P., & Martinez-Giralt, X. (2002). Public and private provision of health care. Journal of Economics and Management Strategy, 11(1), 109–133.
Beam, C., Conant, E., & Sickles, E. (2002). Factors affecting radiologists inconsistency in screening mammography. Academic Radiology, 9(5), 531–540.
Beitia, A. (2003). Hospital quality choice and market structure in a regulated duopoly. Journal of Health Economics, 22, 1011–1036.
Biglaiser, G., & Ma, C. (2003). Price and quality competition under adverse selection: market organization and efficiency. RAND Journal of Economics, 34(2), 266–286.
Boer, F., de Koning, H., Warmerdam, P., Street, A., Friedman, E., & Woodman, C. (1998). Cost effectiveness of shortening screening interval or extending age range of NHS breast screening programme: computer simulation study. British Medical Journal, 317, 376–379.
BreastScreen Australia (2004). National accreditation standards. http://www.breastscreen.info.au/internet/screening/publishing.nsf/Content/br-accreditation/File/standards.pdf, retrieved on 31.05.2008.
Byrne, M., & Thompson, P. (2002). Screening and preventable illness. Journal of Health Economics, 20, 1077–1088.
Chakley, M., & Malcomson, M. (2000). Government purchasing of health services. In A. Culyer & J. Newhouse (Eds.), Handbook of health economics (pp. 847–890). Amsterdam: Elsevier.
Clarke, P. M. (1998). Cost benefit analysis and mammographic screening: a travel cost approach. Journal of Health Economics, 17(6), 7367–787.
Eggleston, K. (2002). Multi-tasking, competition and provider payment. Department of Economics Tufts University Discussion Paper 2001-01.
Ellis, R. (1998). Creaming, skimping and dumping: provider competition on the intensive and extensive margins. Journal of Health Economics, 17, 537–555.
Elmore, J. G., Miglioretti, D. L., Reisch, L. M., Barton, M. B., Kreuter, W., Christiansen, C. L., & Fletcher, S. (2002). Screening mammograms by community radiologists: variability in false-positive rates. Journal of the National Cancer Institute, 94(18), 1373–1380.
Elmore, J. G., Miglioretti, D. L., & Carney, A. P. (2003). Does practice make perfect when interpreting mammography? Part II. Journal of the National Cancer Institute, 95(2), 250–252.
Esserman, L., Cowley, H., Eberle, C., Kirkpatrick, A., Chang, S., Berbaum, K., & Gale, A. (2002). Improving the accuracy of mammography: volume outcome relationship. Journal of National Cancer Institute, 94(5), 369–375.
Fuloria, P. C., & Zenios, S. A. (2001). Outcomes-adjusted reimbursement in a health care delivery system. Management Science, 47(6), 735–751.
Gravelle, H. (1999). Capitation contracts: access and quality. Journal of Health Economics, 18, 315–340.
Güneş, E., Chick, S. E., & Akşin, O. Z. (2004). Breast cancer screening services: trade-offs in quality, capacity, outreach, and centralization. Health Care Management Science, 7(4), 291–303.
International Agency for Research on Cancer Working Group on the Evaluation of Cancer-Preventive Strategies (IARC) (2002). Breast cancer screening. Lyon: International Agency for Research on Cancer Press.
Kan, A., Olivotto, I., Burhenne, L. W., Sickles, E., & Coldman, A. (2000). Standardized abnormal interpretation and cancer detection ratios to assess reading volume and reader performance in a breast screening programme. Radiology, 215, 563–567.
Kesteloot, K., & Voet, N. (1998). Incentives for cooperation in quality improvement among hospitals–the impact of the reimbursement system. Journal of Health Economics, 17, 701–728.
Kirch, R. L. A., & Klein, M. (1974). Surveillance schedules for medical examinations. Management Science, 20(10), 1403–1409.
Klabunde, C., Bouchard, F., Taplin, S., Scharpantgen, A., & Ballard-Barbash, R. (2001). Quality assurance for screening mammography: an international comparison. Journal of Epidemiology and Community Health, 55, 204–212.
Kolata, G. (2003, December). 50 and ready for a colonoscopy? Doctors say wait is often long. NY Times.
Ma, C. (1994). Health care payment systems: cost and quality incentives. Journal of Economics and Management Strategy, 3(1), 93–112.
Matsubayashi, N. (2007). Price and quality competition: the effect of differentiation and vertical integration. European Journal of Operational Research, 180(2), 907–921.
Michielutte, R., Sharp, P., Foley, K., Cunningham, L., Spangler, J., Paskett, E., & Case, L. (2005). Intervention to increase screening mammography among women 65 and older. Health Education Research, 20(2), 149–162.
Moss, M. (2002, June 27). Spotting breast cancer: doctors are weak link. NY Times.
Nodine, C. F., Kundel, H. L., Mello-Thoms, C., Weinstein, S. P., Orel, S. G., Sullivan, D. C., & Conant, E. F. (1999). How experience and training influence mammography expertise. Academic Radiology, 6(10), 575–585.
Segnan, N. (1997). Socioeconomic status and cancer screening. IARC Scientific Publications, 138, 369–376.
Sickles, E. A., Wolverton, D. E., & Dee, K. E. (2002). Performance parameters for screening and diagnostic mammography: specialist and general radiologists. Radiology, 224(3), 861–869.
UK (2007). Retinal screening UK: Service objectives and quality assurance standards: release 5, January 2007. http://www.nscretinopathy.org.uk/resources/Service%20Objectives%20and%20Quality%20Assurance%20Standards%20-%20Release%205,%202007-01-02.doc, retrieved on 08/09/2008.
Wolinsky, A. (1997). Regulation of duopoly: managed competition vs regulated monopolies. Journal of Economics and Management Strategy, 6(14), 821–847.
Zelen, M. (1993). Optimal scheduling of examinations for the early detection of disease. Biometrika, 80(2), 279–293.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Güneş, E.D., Chick, S.E. & Van Wassenhove, L.N. Quality competition for screening and treatment services. Ann Oper Res 178, 201–222 (2010). https://doi.org/10.1007/s10479-009-0645-x
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10479-009-0645-x