Rents for Pills: Financial incentives and physician behavior.
Financial incentives
Health spending
Prescription behavior
Rent-seeking
Journal
Journal of health economics
ISSN: 1879-1646
Titre abrégé: J Health Econ
Pays: Netherlands
ID NLM: 8410622
Informations de publication
Date de publication:
Jan 2023
Jan 2023
Historique:
received:
16
03
2022
revised:
08
11
2022
accepted:
18
11
2022
pubmed:
24
12
2022
medline:
25
1
2023
entrez:
23
12
2022
Statut:
ppublish
Résumé
We study the impact of financial incentives on the prescription behavior of physicians based on a recent reform in two large Swiss cities. The reform opened up an additional income channel for physician by allowing them to earn a markup on drugs they prescribe to their patients. We find that the reform leads to an increase in drug costs by about 4%-5% per patient translating to significantly higher physician earnings. The revenue increase can be decomposed into a substitution and rent-seeking component. Our analysis indicates that physicians engage in rent-seeking by substituting larger with smaller packages and by cherry-picking more profitable brands. Although patient health is not sacrificed, the rent-seeking behavior results in unnecessary costs for society.
Identifiants
pubmed: 36563502
pii: S0167-6296(22)00125-4
doi: 10.1016/j.jhealeco.2022.102711
pii:
doi:
Types de publication
Journal Article
Langues
eng
Pagination
102711Informations de copyright
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