Is physician location sensitive to changes in patients' financial responsibility?

Abstract

This study examines how changes to patients' financial responsibility affect physicians' behavior. This is achieved by examining a health insurance reform that changes patients' relative financial responsibilities for a medical service that can be received at one of two locations. In particular, this study examines how physicians' treatment location decisions change after the reform. This study finds that physicians who previously work across the two locations are increasingly observed working at the location that becomes cheaper for patients. Thus, physicians' responsiveness to new policies may be an important lever by which certain demand-side health insurance reforms successfully operate.

Keywords: Physician agency; health insurance; insurance design; insurance reform.

Figure 1.

Share of patients treated at an ambulatory surgery center (ASC). This figure presents coefficients estimates of ρ from the event study in Equation 2. Each estimate represents the added effect of CalPERS membership on the probability of a patient being treated at an ASC, conditional on receiving a colonoscopy from a Splitter physician (i.e., physicians who work at both hospitals and Ambulatory Surgery Centers in 2011).

Figure 2.

Work day variation among physicians. Figure 2a presents the average number of days worked in an ASC for physicians in the quarters since reference pricing. Figure 2b presents the average share of days worked at an ASC in a given quarter. Figure 2c presents the average number of days worked in an ASC in the quarters since reference pricing. Figure 2d presents estimates of the added share of working days spent at an ASC in a given quarter, in comparison to the quarter before the reform is introduced, which has been benchmarked to zero. Data is from colonoscopy patient who visits to Splitter physicians (i.e., physicians who work at both hospitals and Ambulatory Surgery Centers in 2011).