Congratulations to Assistant Professor Joshua Gottlieb, winner of the Arrow Award from the International Health Economics Association. He won the prestigious award for his paper “Do Physicians’ Financial Incentives Affect Treatment Patterns and Patient Health?” (with Jeffrey Clemens), published in the American Economic Review [104(4): 1320-1349, 2014].
The Arrow Award honours research on financial incentives and medical treatment. As stated on the IHEA’s website, “The Arrow Award Committee is proud to acknowledge the authors of this innovative and policy-relevant paper.” Dr. Gottlieb conducts research in public finance and applied microeconomics, with a particular focus on health care and urban/real estate economics.
In their paper, Gottlieb and Clemens investigate whether physicians’ financial incentives influence health care supply, technology diffusion, and resulting patient outcomes. They found that: in 1997, Medicare consolidated the geographic regions across which it adjusts physician payments, generating area-specific price shocks; and that areas with higher payment shocks experience significant increases in health care supply. They observed that, on average, a two percent increase in payment rates leads to a three percent increase in care provision; elective procedures such as cataract surgery respond much more strongly than less discretionary services; and on-radiologists expanded their provision of MRIs, suggesting effects on technology adoption.