Scandinavian Working Papers in Economics

HERO On line Working Paper Series,
Oslo University, Health Economics Research Programme

No 2015:5: Does performance disclosure influence physicians’ medical decisions? An experimental study*

Geir Godager (), Heike Hennig-Schmidt and Tor Iversen
Additional contact information
Geir Godager: Department of Health Management and Health Economics, Postal: HERO / Department of Health Management and Health Economics, P.O. Box 1089 Blindern, NO-0317 Oslo, Norway
Heike Hennig-Schmidt: BonnEconLab, Postal: BonnEconLab, Laboratory for Experimental Economics, Department of Economics, University of Bonn, Germany.
Tor Iversen: Department of Health Management and Health Economics, Postal: HERO / Department of Health Management and Health Economics, P.O. Box 1089 Blindern, NO-0317 Oslo, Norway

Abstract: Quality improvements in markets for medical care are key objectives in any Health reform. An important question is whether disclosing physicians’ performance can contribute to achieving these goals. Due to the asymmetric information inherent in medical markets, one may argue that changes in the information structure are likely to influence the environment in which health care providers operate. In a Laboratory experiment with medical students that mimics a physician decision-making environment we analyze the effect of disclosing performance information to peers. Our results suggest that the information structure does influence the individual physician’s supply of medical services. Under performance disclosure, choices that are in accordance with the medical norm or maximize the joint benefit become more frequent.

Keywords: Physician payment system; laboratory experiment; incentives; performance disclosure; fee-for-service; information and product quality

JEL-codes: C91; H40; I11; J33; L15

32 pages, November 9, 2015

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