Incentives and risk in the Physicians Market
In this session, we propose three papers that examine physician behavior under different economic environments. In the first paper, Pierre Thomas Léger and Robert Town provide a theoretical model of utility maximizing physicians that reconciles a series of established facts on geographic variations in healthcare spending and utilization. The model specifically considers the Medicare and commercial insurance markets and the interactions between them. The model is then used to evaluate potential policy changes that seek to improve efficiency. In the second paper, Ashley Swanson and Jonathan Kolstad consider physician decision making under uncertainty. More specifically, they use machine-learning methods to examine the causal role of uncertainty on physician decisions in a labor-delivery setting. In the final paper, Michael Richards and Evan Saltzman examine physician behavior under temporary changes in payments. Using a difference-in-difference approach, they exploit temporary changes in Medicare reimbursements to physicians in the Medicare Modernization act to study changes in the provision of care in the Medicare market.