1. Andrew Street
Professor of Health Economics
Competition and market
mechanisms in health care:
overview

2.  Competition ≠ privatisation
 Competition is not directly observable
 Competitive effects are conditional on other
features
 Competition is not the only instrument

3.  Competition ≠ privatisation
 But people are (rightly) suspicious
 Telecoms, British Rail, Royal Mail
 Private sector treatment centres
 Lower LoS
 But paid (much) more than they have delivered

4.  Competition is not directly observable
 Distance measures – how many
organisations are in the vicinity or how far
away is the nearest organisation?
 Are neighbouring organisations …
 Competing?
 Collaborating?
 Differentiating?
 Additional measures – patient choice,
qualitative information

5. Care
homes
Hospitals
>10,000
150
Flexible
pricing
National
tariff
Neutral?
Reduced?
Number Price Quality
 Competitive effects are conditional

6.  Competition is not the only instrument
 Yardstick competition – Payment by Results
 Collaboration – integrated care
 Closures