Payment models to coordinate healthcare providers: Extension to risk-averse providers

Abstract Previous works compared the performance of the bundled and unbundled payment schemes in a referral-based setting where the providers (generalist and specialist) are risk-neutral and health outcomes are partial attributable to the providers. In this work, we extend the results to a setting where the providers are risk-averse. We also show that a bundled scheme has higher referral rates, lower time spent by the specialist, higher specialist utilization relative to an unbundled system in most scenarios.