September 10, 2019

Treatment responses of mental health care providers after a demand shock

This paper investigates how two different groups of Dutch mental health care providers responded to an exogenous 20% drop in the number of patients in 2012. Providers that operated under a budget increase treatment duration on average by 8%. We fi nd suggestive evidence for over-treatment as the longer treatments did not result in better patient outcomes, i.e. general assessment of functioning scores. Both professional uncertainty and income effects may explain the results.
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For the group of self-employed providers, paid by a stepwise fee-for-service function, we find only a small signi cant increase in treatment duration for the least altruistic providers, which we relate to an income effect.

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