Unbiased Analysis of Today's Healthcare Issues

Operating on commission: Analyzing how physician financial incentives affect surgery rates

Written By: Jason Shafrin - Apr• 09•10

My paper on how physician compensation affects surgery rates is being published in the May 2010 edition of Health Economics.  The abstract from the article is below:

This paper employs a nationally representative, household-based dataset in order to test how the compensation method of both the specialists and the primary care providers affects surgery rates. After controlling for adverse selection, I find that when specialists are paid through a fee-for-system scheme rather than on a capitation basis, surgery rates increase 78%. The impact of primary care physician compensation on surgery rates depends on whether or not referral restrictions are present.

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One Comment

  1. Interesting post, in line with much of the supply side work of Drs. Fisher and Wennberg of the Dartmouth Atlas. There are clearly system changes that are going to ensue as a result of health reform. Shepherding those changes into a meaningful, efficient and quality producing system is going to take years of work. Follow many of the delivery system developments at http://ilovebenefits.healthcarebenefitsnetwork.com/

    We are also creating a network of healthcare benefits experts at http://www.hcbn1.com to help guide health plans and employers in the understanding of the customer requirements and developmental principles that will be needed as new system designs emerge — from plan design to the application of lean six sigma in process delivery.

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