The Messenger Model: Don't Ask, Don't Tell?

Abstract:     
The messenger model permits competing providers - physicians, hospitals, etc. - to make use of a common agent in their dealings with payers. This article makes the case that the messenger model is either tacitly or inadvertently a don't ask, don't tell policy when it comes to competitor cooperation. In addition, this article presents an economic framework that explains how such a policy may benefit health care consumers. Finally, it is suggested that the don't ask, don't tell policy has created an area of per se legality that precludes an examination designed to distinguish consumer-benefiting practices from those that provide no benefit.

Number of Pages in PDF File: 13

Keywords: antitrust, health care, collusion, efficiency, bilateral monopoly

JEL Classification: K13,K21,L41,L44

Accepted Paper Series