Abstract:

Objective To analyze reasons of the imbalance between economic supervision and public welfare supervision of public hospitals and to propose applicable measures for solving the problem of common agency of multi-clients and balancing the economic supervision and public welfare supervision. Methods The theory of common agency of multi-clients was adopted to analyze the supervision system and objectives of supervisors. The benefit and welfare of 4 activities, i.e. supervisors act with cooperation, supervisors act simultaneously without cooperation, supervisors of economic supervision act first, and supervisors of public welfare supervision act first, were compared. Results Different action modes had different effects on achieving objectives of supervisors and total social welfare. Cooperation of both supervisors could maximize the social welfare. Simultaneous actions of supervisors without cooperation caused agents obtaining maximum benefits by taking advantage of the in-cooperation of supervisors. Sequential actions of supervisors without cooperation caused supervisors who acted first obtaining maximum benefits. Conclusion Cooperation of multi-supervisors can maximize the social welfare. The government should take measures to promote the cooperation of supervisors and improve the communication and coordination among different regulatory institutions during the course of health care reform, including self coordination, third-part coordination, and super-ministry system.

Key words: public hospital reform, common agency, economic regulation, public welfare regulation, regulation model