Competition, gatekeeping, and health care access.

Area of Science:

• Health Economics
• Healthcare Management
• Physician Referral Behavior

Background:

• Gatekeeping physicians play a crucial role in directing patients to specialty care.
• Understanding the impact of market competition on referral patterns is essential for healthcare policy.
• Previous theories suggest conflicting effects of competition on physician referral decisions.

Purpose of the Study:

• To theoretically derive and empirically assess the effect of physician market competition on patient referrals to specialty care.
• To investigate whether increased competition among primary care physicians influences referral rates.
• To evaluate the validity of policy proposals aimed at reducing secondary care utilization through increased primary care physician supply.

Main Methods:

• Theoretical modeling of physician referral behavior under varying levels of market competition.
• Empirical analysis using a Norwegian dataset from 2008-2009, including survey data, National Health Insurance Administration data, and Statistics Norway data.
• Construction of three distinct measures of physician market competition: unadjusted primary care practice count, population-adjusted primary care practice count, and the Herfindahl-Hirschman index.

Main Results:

• Theoretical predictions indicate that competition can both increase (due to competitive pressure) and decrease (due to higher earnings from self-treatment) referral rates.
• Empirical findings show that increased competition has negligible or small positive effects on overall patient referrals to specialty care.
• The study's results do not provide evidence to support the policy assertion that increasing the number of primary care physicians leads to a reduction in secondary care utilization.

Conclusions:

• The relationship between physician market competition and referral behavior is complex, with theoretical predictions showing opposing effects.
• Empirical evidence suggests that market competition has a limited impact on the rate of patient referrals to specialty care.
• Current policy proposals advocating for increased primary care physician numbers to decrease secondary care demand are not substantiated by this research.