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Cartels or Coordinated Care: Competition in the Dutch Homecare Market

Detail Summary
Date 11 May 2009
Time 11:45 - 13:15
Location Oudemanhuispoort

Abstract

After the introduction of the WMO in 2007, by means of which housekeeping services were unbundled from personal care, the Dutch market for homecare is in transition. As a result of this ‘big bang', a lot of incumbent providers have gotten into severe financial difficulties. At the same time, the Dutch competition authority (NMa) has declared the health care sector to be one of its priority areas, presumably because it sees large risks of antitrust violations. Indeed, in 2008 two decisions were taken in which cooperation agreements were judged to be violations (by object) of Art 6 of the Dutch competition law, thus adding to the problems in the sector. As expected, parties claim that there were no agreements, hence, no violations. More interesting is the fact that, in the past, the Ministry of Health has strongly stimulated health care providers to make agreements of coordination care (ketenzorg) as this would benefit patients. In fact, the ministry continues to do so. In addition, insurance companies, which can be viewed as agents of patients, have explicitly stimulated coordinated care by providing bonuses to providers participating in such agreements. As a result, there is considerable uncertainty in the sector about what is allowed and what is not. In this presentation, we will attempt to draw the line between coordinated care and cartel by providing an economic effects analysis of various types of formal and informal agreements that can be found in the Dutch homecare market.

Oudemanhuispoort
Oudemanhuispoort

Oudemanhuispoort 4-6
1012 CN Amsterdam