• KDI Journal of Economic Policy
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• v.33 no.1
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• pp.125-148
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• 2011

Although the patient's problem with access to health information has been improved due to rapidly developing information technologies, such as the internet, some patients still do not have enough ability to understand, interpret, and analyze the health information. Given this view on the patient's asymmetric information problem, if a doctor provides sufficient effort to help patients understand and interpret medical information, the efficiency of patient's medical care use could be improved. This paper shows firstly that the patient's inefficient use of medical care originates from his information problems, such as the misperception of the effectiveness of medical care and secondly suggests that if the doctor makes sufficient effort to correct patient's information problems, the inefficiency can be ameliorated. This paper also suggests the manipulation of a doctor's payment method can lead a doctor to provide optimal level of efforts which can in turn lead patients to use the optimal level of medical care. With an optimal level of effort, a doctor can more easily achieve a patient's compliance with the newly recommended amount of medical care.