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Managing Health Care in Private Organizations

Transaction Costs, Cooperation and Modes of Organization in the Value Chain

Katharina Janus

Health care delivery systems in all major industrial countries approach a crisis and there is no panacea so far to rising health care costs, in particular as an aging population and advanced medical technology further drive these costs. This dissertation does not attempt to provide a solution to the macroeconomic debate about health care costs. It rather focuses on microeconomics and how health systems (private entities) organize themselves – cooperate, integrate, and disintegrate – in a specific market, the San Francisco Bay Area, U.S.A. Based on transaction cost economics alternative modes of governance in the health care market are examined. For this purpose a long-term case study has been conducted in the Bay Area in order to evaluate how health care transactions should be organized to economize on transaction costs, which experiences have been made over the last years and which strategies are recommendable for future reorganization in the U.S. health care market and other countries. In addition, implications for the German health care market are discussed as well. A conclusion finally summarizes the findings and outlines further areas of research.
Contents: The Transaction Costs Theory as an Economic Basis – Assessing the Health Care Market with Respect to the Transaction Costs Theory and Modes of Governance – Concepts for Economizing on Transaction Costs in Hybrid Forms of Organization – Cooperation and Modes of Organization in the Bay Area Health Care Market - an Empirical Case Study – Pharmaceutical Companies - taking a More Comprehensive approach to Health Care Delivery – Implications for the German Health Care Market.