Abstract
The information asymmetry of online healthcare services in China puts pressure on platforms to assure service efficacy. To prevent the online healthcare market failure and investigate optimal pricing and profits, we compared three quality regulation strategies: (1) no regulation; (2) exclusion: the platform excludes low-quality physicians; and (3) quality certification: the platform certifies high-quality physicians. Our analysis indicates that quality management improves the average quality of registered physicians, the number of users (patients and physicians), and social welfare. The quality certification strategy maximizes social welfare, whereas the exclusion strategy maximizes the scale of high-quality physicians and registered physicians’ average quality. Furthermore, the exclusion strategy can generate the highest profits for the platform only when patients have high enough quality preferences. Finally, the pricing level of healthcare platforms is influenced by network externality and certification investment. This study provides guiding principles for platform managers to regulate online healthcare services.
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This research is funded by the National Natural Science Foundation of China (71974082).
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Conceptualization and literature review, Zhiqiang Ma and Jianyue Liu; methodology, Jianyue Liu; calculation, Jianyue Liu; writing and editing, Jianyue Liu and Zhiqiang Ma. All authors have read and agreed to the published version of the manuscript.
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Liu, J., Ma, Z. Optimal quality regulation on the online health platform. Electron Markets 33, 50 (2023). https://doi.org/10.1007/s12525-023-00670-3
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DOI: https://doi.org/10.1007/s12525-023-00670-3