Managed Competition in Healthcare (?): Comment on "Measuring Active Purchasing in Healthcare: Analysing Reallocations of Funds Between Providers to Evaluate Purchasing Systems Performance in the Netherlands"

TL;DR

This paper critiques the assumption that competitive reforms in healthcare lead to efficient fund allocation, highlighting risks in countries with weak regulation.

Contribution

It challenges the unexamined assumption of market efficiency in healthcare funding and emphasizes the risks of market-based reforms in poorly regulated environments.

Findings

There is no uniform theory on how market forces regulate healthcare markets.

Market-based reforms may be risky in countries with limited regulatory capacity and corruption.

Abstract

This article comments on the paper by Stadhouders et al titled "Measuring Active Purchasing in Healthcare: Analysing Reallocations of Funds Between Providers to Evaluate Purchasing Systems Performance in the Netherlands." Its main aim is to respond to the fact that the paper, without discussion, assumes that competitive reform stimulates the efficient allocation of funds. To achieve this goal, this article discusses existing knowledge related to the author’s assumption, highlighting that there is no uniform theory regarding the capacity of market forces to regulate healthcare markets. It also argues that market-based healthcare reforms may be very risky in countries with limited state regulatory capacity and widespread corruption.