Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
In most health care systems where a prospective payment system is implemented, an outlier payment is used to cover the hospitals' unusually high costs. When the hospital chooses its cost reduction effort before observing a patient's severity, we show that the best outlier payment is based on the realized cost when the hospital exerts the first best level of effort, for any level of severity.