Private implementation principles

In response to rapidly increasing health care costs, private insurance companies and employers (who pay the premiums in whole or in part for their employees) have increased their part in implementing cost-containment strategies. A dramatic effort has been the application of business principles to purchasing and vendor selection and payment for and selection of health care providers and institutions of care. 

A new law on health insurance is expected to be implemented by 2,000. The sickness fund will be public cind organized on a self-governing principle. Complementary private systems will also be possible. The type and quality of pharmaceuticals used for outpatient and inpatient treatment will be controlled by the state. 

Can the SUBSAFE principles be transferred from the military to commercial companies and industries The answer lies in why the program has been so effective and whether these factors can be maintained in other implementations of the principles more appropriate to non-military venues. Remember, of course, that private contractors form the bulk of the companies and workers in the nuclear Navy, and they seem to be able to satisfy the SUBSAFE program requirements. The primary difference is in the basic goals of the organization itself. 

Care should be taken in interpreting the revelation principle. First, the revelation principle does not imply that incentive-compatibility comes for free . In fact, a central theme of mechanism design is that there is a cost to the elicitation of private information. The mechanism design literature is peppered with impossibility results that characterize sets of desiderata that are impossible to achieve simultaneously because it is necessary to incent agents to participate in a mechanism [53]. Rather, the revelation principle states that if a particular set of properties can be implemented in the equilibrium of some mechanism. 

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