Abstract
We developed a model to formulate the referral process in a tiered hospital system involving a general hospital (GH) and community healthcare centers (CHCs), where green channels are built on priority. We propose two types of referral strategies to address delay-sensitive patients based on: (1) patients’ choice (PC) and (2) independent decision-making by the hospital (DMH). Through price subsidy and priority mechanism, both PC and DMH can effectively regulate patient choice behavior and guide all patients to choose a CHC for the first diagnosis. This could help the Chinese government implement a gatekeeping system even if free referral of patients is allowed. We determine the optimal capability decisions of the GH (for profit maximization) and each CHC (for maximization of patient utility), under two strategies. The main results are as follows: under PC, the referral process is controlled by the GH, but the government’s coordination tools (budget and tax rate) would not influence the GH’s decision on its optimal arrival rate with the green channel. In contrast, DMH offers the government more power to control the referral process using budget and tax rate. Numerical analysis provides managerial insights for the government to better use tax-subsidy policies and make an optimal choice between PC and DMH.
Published Version
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