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One physical therapist is paid $20 per session
One physical therapist is paid $20 per session. Another is paid $400 per week plus $20 per session in excess of 20 sessions per week. A third is paid $400 per week, plus $200 per week for having all paperwork complete and filed within 48 hours, plus $20 per session in excess of 30 sessions per week. How do the therapists’ incentives to produce sessions compare? How do their incentives to complete paperwork differ?
Expert Solution
Answer: The incentives to produce sessions compare because all three of them have fixed and cost variables. Their incentives to complete paperwork are different because therapist one is only offered $20 per session which seems to be least then therapist two and three. Therapist three seems to be offered the most when it comes to the amount offered when completing paperwork. There is no offer for the first therapist to complete the paperwork whereas two (20 sessions) and three (48 hours) do.
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