Regulating physicians’ prices in the presence of health platforms

Abstract

Online platforms connecting physicians and patients are becoming increasingly common and often operate in contexts where prices are regulated and uniform across booking channels. We consider a platform that provides cost-reducing services for physicians and quality-enhancing services for patients. The platform improves the matching between patients and physicians, thereby increasing competition among the latter. When prices are unregulated, physicians charge different prices online and offline. Not all of them join the platform, which is suboptimal in terms of social welfare. The platform may also under- or over-invest in the quality level offered to patients, making their participation suboptimal as well. We then analyze price regulation. Under a single regulated price for medical visits, regardless of the booking channel, all physicians join the platform. However, the first-best allocation cannot be implemented: patient participation remains inefficiently low because patients do not internalize the platform’s cost-reducing effect. In contrast, allowing two regulated prices, one for offline visits and one for online bookings, restores the first best. Overall, our findings suggest that an optimal pricing or reimbursement mechanism should differentiate across booking channels.

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Reference

Chiara Canta, Leonardo Madio, Andrea Mantovani, and Carlo Reggiani, “Regulating physicians’ prices in the presence of health platforms”, Journal of Regulatory Economics, vol. 69, n. 20, August 2026.