The Evolution of Physician Practice Styles: Evidence from Cardiologist Migration

Abstract

Physician treatment choices for observably similar patients vary dramatically across regions. This paper exploits cardiologist migration to disentangle the role of physician-specific factors such as preferences and learned behavior versus environment-level factors such as hospital capacity and productivity spillovers on physician behavior. Physicians starting in the same region and subsequently moving to dissimilar regions practice similarly before the move. After the move, physician behavior in the first year changes by 0.6-0.8 percentage points for each percentage point change in practice environment, with no further changes over time. This suggests environment factors explain between 60-80 percent of regional disparities in physician behavior.

Figure 1. Distribution of Two-Day Cath Rates by HRR

Notes: Map shows the geographic distribution of two-day cardiac catheterization rates among Medicare heart attack (AMI) patients across the 306 Hospital Referral Regions (HRRs). Cath rates are calculated over pooled years 1998–2012 and weighted by the number of AMI patients treated in each region during this period. Rates are risk-adjusted for patient age, race, sex, and first heart attack.

Figure 2. Distribution of Changes in Two-Day Cath Environment across Move

Notes: Figure 2 shows the distribution of changes in cath environment among cardiologists who move HRRs. In panel A, the change for cardiologist j is defined as Δ_j = (destination HRR cath intensity)_j – (origin HRR cath intensity)_j, defined as a physician-leave-out mean that omits physician j's own patients from the risk-adjusted HRR cath rates shown in Figure 1. Panel B shows the analogous distribution of changes in hospital cath intensity across the move based on the hospitals where the physician's patients were admitted. In both panels, the distribution is weighted by the number of sample heart attack patients treated by cardiologist movers.

Figure 3. Event Study—Change in HRR Environment

Notes: Graph plots (solid black) estimates of physician practice style t years since move as a function of the change in HRR cath environment experienced across the move (see Figure 2, panel A). These estimates come from a regression that includes fixed effects for origin HRR, calendar year of patient admission, years since physician move, and patient age, race, sex, and first heart attack. Results controlling for physician fixed effects instead of origin HRR are plotted by the dashed gray line. Bands indicate 95 percent confidence intervals constructed from two-way clustered standard errors at the physician and HRR levels.

Figure 4. Event Study—Change in Hospital Environment

Notes: Graph plots estimates of physician practice style t years since move as a function of the change in hospital cath environment experienced across the move (see Figure 2, panel B). Panels A and B plot estimates from separate regressions that include the same controls as the physician fixed effects regression behind Figure 3 (dashed gray line). Bands indicate 95 percent confidence intervals constructed from two-way clustered standard errors at the physician and HRR levels. For panel B, the regression allows for separate effects by whether the physician moved to more-intensive (Δ > 0) or less-intensive (Δ ≤ 0) hospitals. Physician behavior is normalized to zero in the year immediately prior to the move (t = −1).