Quarterly scientific journal

Physiotherapist T.Y.P.E.T, MSc (c) Health Management, Faculty of Social Sciences, Hellenic Open University, Greece

Matthaios Petrelis


The demand inducement for health services refers to the tendency of physicians to prescribe higher cost of treatment and higher quantity of health services than the patient would have chosen if he had the knowledge of the doctor. Therefore, this is due to information asymmetry and the agency relationship between doctors and their patients, leading to waste of resources and increased costs as a result of overconsumption of health services beyond the 'Pareto Optimum' (allocative efficiency). Typical examples in Greece are the large proportion of cesarean sections and the increased pharmaceutical expenditure, which is twice as high as the OECD average. During the years of the financial crisis, a variety of fiscal policy measures have been taken, emerged as a field of resource-saving policies, with representative examples the system of e-Prescribing medicines and control system based on therapeutic protocols, the promotion of generics in order to address over-prescription and the implementation of Diagnostic Related Groups (DRGs) as a method of reimbursement in hospitals. Despite the initial spectacular declining numbers of health expenditure, the results were ambiguous necessitating redefinition and new goal setting as well as the mixture of health policies.

Keywords: Demand inducement, health services, measures of health policies, Greece, pharmaceutical expenditure, DRGs

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