Working Paper: NBER ID: w21855
Authors: David C. Chan Jr.
Abstract: Substantial practice variation across physicians for seemingly similar patients remains an unresolved puzzle. This paper studies physicians in training to explore the behavioral foundations of practice variation. A discontinuity in the formation of teams reveals a large contribution of relative experience in the size of practice variation. Among the same physician trainees, convergence towards a common practice differs by practice environment, with more convergence in specialist-driven services. Rich trainee characteristics and training histories, including the practice styles of prior supervising physicians, explain little if any variation. These findings suggest a major role for informational frictions in the origins of practice variation.
Keywords: practice variation; informational frictions; physicians in training; healthcare spending; medical decision-making
JEL Codes: D20; D83; I10; L23; L84; M11; M53; M54
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| assignment of patients to housestaff (I11) | daily total spending (H61) |
| assignment of patients to housestaff (I11) | daily test spending (H56) |
| assignment of patients to housestaff (I11) | length of stay (C41) |
| assignment of patients to housestaff (I11) | 30-day readmissions (I11) |
| assignment of patients to housestaff (I11) | 30-day mortality (C41) |
| housestaff spending (H51) | clinical outcomes (I12) |
| experience of physicians (I11) | practice variation (K40) |
| transition from interns to residents (J62) | standard deviation of spending effects (D12) |
| informational frictions (D89) | practice variation (K40) |