Competition and physician behaviour: Does the competitive environment affect the propensity to issue sickness certificates?

Area of Science:

• Health Economics
• Medical Practice Management
• Public Health Policy

Background:

• Physician competition is prevalent but its effect on healthcare services remains under-researched due to endogeneity.
• Limited empirical data exists on how competition influences physician service provision.

Purpose of the Study:

• To investigate the impact of competition on general practitioners' (GPs) sicklisting behavior.
• To determine the role of financial incentives in physician competition and service provision.

Main Methods:

• Utilized high-dimensional fixed-effect models to analyze physician behavior.
• Exploited a natural experiment where GPs work in both competitive (own practice) and non-competitive (emergency centers) settings.
• Compared sicklisting certification rates between GPs' own practices and emergency centers.

Main Results:

• GPs with fee-for-service contracts were 12 percentage points more likely to certify sick leave in their own practice compared to emergency centers.
• GPs with fixed-salary contracts showed an 8 percentage point higher likelihood of certifying sick leave in their own practice.
• Competition significantly increases sicklisting, with financial incentives strongly reinforcing this effect.

Conclusions:

• Physician competition positively influences sicklisting practices among general practitioners.
• Financial incentives, particularly fee-for-service models, significantly amplify the impact of competition on sicklisting.
• Findings highlight the importance of considering competitive dynamics and financial structures in healthcare policy.