CCHE Seminar Series: Physician Practice Style and Healthcare Costs: Evidence from Emergency Departments

Gautam Gowrisankaran, Keith Joiner and Pierre Thomas Léger

University of Illinois Chicago’s School of Public Health

Friday April 23, 2021, 10am-12pm, Zoom

Abstract: We study healthcare operations of emergency departments (EDs) by examining the practice style and skills of ED physician-led teams. Our data include all residents of Montreal, Canada with an initial ED visit in Montreal during a 9 month period. For each visit, our data record the initial treating hospital, ED physician, ED billed expenditures, and all interactions with the health system within the subsequent 90 days. Physicians in Montreal rotate across shifts between simple and difficult cases, implying a quasi-random assignment of patients to physicians within an ED. We consider three medical conditions that present frequently in the ED and for which mistreatment may have dramatic consequences: angina, appendicitis, and transient ischemic attacks, jointly examining diagnostic and disposition skills. To control for variation in diagnosis, our sample for each condition consists of patients with a broader set of symptoms and signs potentially indicative of the condition. Separately by condition, we regress healthcare usage and cost measures on indicators for physician-led teams to estimate the skill and practice style of each team. We then evaluate the variation across teams in their practice style and skills and the correlations between different measures of skill and practice style. We find significant variation across physician-led teams in their practice styles and skills. We also find that physician-led teams with costly practice styles often have worse outcomes in terms of more ED revisits and more hospitalizations. Finally, the practice styles and skills of physician-led teams correlate positively across the three conditions that we consider.

Pierre Thomas Léger is an Associate Professor in the Division of Health Policy and Administration at the University of Illinois Chicago’s School of Public Health, where he directs the HPA’s graduate programs. Prior to joining UIC, Prof. Léger was an Associate Professor at the University of Montreal’s business school, HEC Montréal, where he held the Professorship in Health Economics. He has held visiting positions in the Department of Health Care Management at The University of Pennsylvania’s Wharton School, The Paris School of Economics and the University of Los Andes, Chile. Prof. Léger’s research focuses on various topics in health and healthcare economics with a particular emphasis on the physicians’ market. He has examined how treatment decisions, healthcare costs and patient outcomes are, and can be, shaped by different market conditions including alternative provider payments mechanisms and competition. His current research projects include: (i) estimating across-physician variations in care and outcomes, (ii) explaining geographic variations in healthcare utilization and spending in Medicare and commercial markets, (iii) estimating the impact of sugar-sweetened beverages taxes on prices and consumption, and (iv) estimating the impact of nursing and physician-assistants program expansions on medical markets.

Gautam Gowrisankaran joined the Eller College of Management as Associate Professor of Economics in 2007. He was appointed the Arizona Public Service professor of economics in 2011 and the Peter and Nancy Salter Chair in Healthcare Management in 2020. His research focuses on industrial organization, health economics, energy and environmental economics and applied econometrics. In recent papers, he has examined the gains from environmental regulations being dynamic, the presence and causes of non-rational decision-making for drug purchases under Medicare Part D, the social costs of renewable energy accounting for the fact that it is intermittent, micro-foundations of applied bargaining models and the impact of hospital mergers on bargaining leverage and prices (among other topics). He earned his PhD in Economics from Yale University in 1995 and is the recipient of a 2017 Doctorate Honoris Causa from the University of Oulu. He has previously taught at Harvard University, the University of Minnesota and Washington University in St. Louis.

A medical doctor, Keith Joiner joined the Eller College of Management in 2010 as co-director of the Center for Management Innovations in Healthcare. He was appointed professor of economics in 2012. His vast professional experience includes founding the Investigative Medicine Program at Yale University and serving as the dean of the University of Arizona College of Medicine from 2004 to 2008. His research focuses on: the optimization of resource allocation in academic health centers; the relationship between medical decision-making in emergency departments and the subsequent cost and outcome; regret aversion in medical decision-making; new reimbursement models for high cost health care interventions; and, the application of the concept of service dominant logic to the health care sector. He earned his medical degree at the University of Colorado in 1974 and also holds a master’s in public health from Yale University.