Waiting for Surgey: Effects on Health and Labor Supply

In centrally organized health care systems, patients often face significant wait times for specialist treatment when capacity constraints are binding. In this paper, we estimate the effect of increased waiting for orthopedic surgery (days from referral to surgery) on health and labor market outcomes, using microdata covering all publicly funded orthopedic surgeries in Norway referred in 2010 and 2011. As the system assigns higher priority to more urgent cases, naive OLS estimates linking observed wait times to individual patient outcomes could reflect selection bias if more severe cases receive faster treatment. Our identification strategy exploits quasi-random variation in wait times for surgery generated by the idiosyncratic variation in system congestion at the time of a specific patient's referral for surgery. Precisely, we instrument a patient's wait time by the average wait time of other patients queued for the same procedure at the same hospital around the same time.

We find no significant evidence that waiting longer for surgery affects healthcare utilization, except to move some utilization forward in time. We also find no evidence waiting longer affects surgical success, the likelihood of disability pension entry, or mortality. However, longer wait times significantly increase sick leave use among patients queued for care. For every 10 additional days spent waiting for surgery, sick leave in the two years following referral increases by about 2.6 days. This can largely be explained by a mechanical effect: longer waits extend a period when propensities for sick leave are particularly high, presumably due to the underlying ailment.