Variations in physician practice are pervasive and costly, and may be harmful. The objective of much policy in the West is to increase the interconnectedness of physicians, furthering the transfer of information and thus reducing variation.
This study tests whether physicians are influenced by the practice of peers, or if propensity, mere context or sorting of like-minded physicians better explain similarities and differences in practice. We study US cardiologists who place coronary stents into patients with blocked arteries around the heart. Organized in locally competing physician groups and also as solo practitioners, they see patients in offices, but insert the stents at a shared production facility – the cath lab.
We examine their use of the popular drug-eluting coronary stents between their launch and rapid adoption in early 2003, and through the period of late 2006 in which private and public reports of serious late side-effects eventually led to reductions in use. Our analyses use administrative claims data on nearly 1000 cardiologists and their patients in Florida, USA, merged with Florida physician licensure data. Collectively these physicians used these stents nearly a quarter of a million times in the 4 year period reviewed. Pooled and panel linear regressions for device utilization by a physicians are estimated using measures of peer utilization, physician characteristics and controls for unobservable physician characteristics, common shocks and selection effects.
We find strong evidence for intra-group but against inter-group practice spillovers. Even when sharing the same lab, competing cardiologists did not appear to correlate practices. Our results are consistent with a view that policies aimed at increasing the interconnectedness of physicians must first consider the organizational barriers and competitive forces that can stymie knowledge transfer even among physicians working closely together.
Variations in physician practice are well-known in the US (Wennberg & Cooper, 1999), and policies that aim to enhance connections between and improve information flow among healthcare providers may be effective (O’Connor et al., 1996, Valente and Davis, 1999, Majumdar et al., 2002, Majumdar et al., 2004, Nicholson and Epstein, 2003, Jippes et al., 2010 and Meltzer et al., 2010). The premise of such policies is illustrated in the classic Coleman, Katz, and Menzel (1966) study which showed physician peer effects played an important part in the adoption of tetracyclines. Much research finds the potential influence of other physicians and key opinion leaders remains strong (Bikhchandani et al., 2002, Berwick, 2003, Borbas et al., 2000, Burke et al., 2007, Chandra and Staiger, 2007, Escarce, 1997, Grilli and Lomas, 1994, Greenhalgh et al., 2004, Meltzer, 2009 and Soumerai et al., 1998).
This study was undertaken to explore whether organizational barriers and competitive forces may affect knowledge transfer and harmonization of practices. The impetus for the study is the apparent conflict between those who see peer effects as possibly an important and positive force for reducing variation, and between those who point out the apparent persistence of practice variation. We used the dynamic adoption, utilization and partial abandonment of drug-eluting stents in Florida between 2003 and 2006 to investigate possible peer effects among nearly 1000 specialist cardiologists organized in locally competing practice groups or as solo practitioners.
