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by khafra 1677 days ago
For specifically the doctor version of the principle-agent problem, Robin Hanson published an incentive-compatible solution over 25 years ago: http://mason.gmu.edu/~rhanson/buyhealth.html
1 comments

> To cure health care, give your care-givers a clear incentive to keep you well. Make sure that when you lose, they lose, and just as much. Buy lots of life and disability insurance from your care-givers, and have a third party, unable to act against your life or health, pay you to be the beneficiary.
So, basically bundling insurance with the healthcare provider, like kaiser?
The quantitative difference is big enough to be qualitative. You have to buy a lot of life insurance, more than people normally get, to make it work. The disinterested third party beneficiary makes this affordable:

> There are, however, two big problems with this approach. The first is that even though my life may be worth $10 million to me, most of the (huge) insurance premium to pay for this insurance would be wasted from my point of view -- there probably is not one person to whom I would want to give this much money when I die. The other problem is moral hazard -- heavy insurance may reduce my incentive to keep myself healthy, and may even create incentives for my relatives to try and hurt me. It might be a problem if I could only give my doctor a 50 percent interest in my life by taking away 50 percent of my own interest, or by giving a minus 50 percent interest to my relatives.