Capsule Commentary on Silvestri et al., Impact of Cost Display on Ordering Patterns for Hospital Laboratory and Imaging Services

Capsule Commentary on Silvestri et al., Impact of Cost Display on Ordering Patterns for Hospital... Capsule Commentary on Silvestri et al., Impact of Cost Display on Ordering Patterns for Hospital Laboratory and Imaging Services Joseph A. Ladapo, MD, PhD David Geffen School of Medicine at UCLA, Los Angeles, CA, USA. J Gen Intern Med 33(8):1383 increasingly concluded that the marginal cost of a lab or DOI: 10.1007/s11606-018-4516-5 imaging test exceeded its marginal benefit. But how well © Society of General Internal Medicine 2018 do physicians know the preferences of their patients? Would a well-informed patient feel similarly to his or her physician about the cost-benefit balance of a test or study? Another interesting issue relates to the decision psychology of interpreting prices. For example, physicians ilvestri et al. evaluated an economics-based intervention may bemorelikelytoorder atestifits priceisadjacentto that is relatively innovative in healthcare but would be 3 another test that is more expensive, and we are all famil- considered commonsense in other fields—namely, providing iar with the purchase-inducing effects of ending prices buyers (physicians) with information about costs of the ser- 4 with the number 9, compared to other numbers. We vices they purchase. Using a pre-post design, they found that should recognize that the study by Silvestri et al. serves displaying costs in the EHR for lab and imaging tests was as a bridge to areas of investigation at the heart of physi- associated with a decrease in the number of studies ordered for cian decision-making and the patient-doctor relationship. hospitalized patients and a decrease in overall lab and imaging costs. Inferences about causal relationships in non-randomized Corresponding Author: Joseph A. Ladapo, MD, PhD; David Geffen studies are fraught with risks. However, initiation of the inter- School of Medicine at UCLA, Los Angeles, CA, USA (e-mail: jladapo@mednet.ucla.edu). vention was associated with a sharp step-off in cost trends, so I am persuaded to believe that it causally influenced physician decision-making. While the effects were quantitatively mod- est, they are substantial at the hospital or health system level, REFERENCES assuming no untoward health effects of decreased testing. 1. Silvestri MT, Xu X, Long T, Bongiovanni T, Bernstein SL, Chaudhry SI, Altogether, these are important findings. Silvestri JI, Stolar M, Greene EJ, Dziura JD, Gross CP, Krumholz HM. But what appears to Bonly^ be a study about cost Impact of Cost Display on Ordering Patterns for Hospital Laboratory and Imaging Services. J Gen Intern Med. DOI: https://doi.org/10.1007/ display is really something much more. The authors’ study s11606-018-4495-6. introduces a trove of scientific areas of inquiry that have 2. Kenneth JA. ‘The economics of agency’ in Principals and agents: The structure of business. In: Pratt JW, Zeckhauser RJ, eds. Boston: Harvard intrigued economists and psychologists alike. The pur- Business School Press;1985:37–51. chase of services by physicians on behalf of patients is 3. Kim J, Novemsky N, Dhar R. Adding small differences can increase really a classic principal-agent problem in economics. In similarity and choice. Psychol Sci 2013;24(2):225–229. 4. Anderson ET, Simester DI. Effects of $9 Price Endings on Retail Sales: providing care, physicians act as agents for their patients, Evidence from Field Experiments. Quant Mark Econ 2003;1(1):93–110. the principals. Implied in the results of Silvestri et al. is that physicians, when presented with cost information, Published online June 4, 2018 http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of General Internal Medicine Springer Journals

Capsule Commentary on Silvestri et al., Impact of Cost Display on Ordering Patterns for Hospital Laboratory and Imaging Services

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Publisher
Springer US
Copyright
Copyright © 2018 by Society of General Internal Medicine
Subject
Medicine & Public Health; Internal Medicine
ISSN
0884-8734
eISSN
1525-1497
D.O.I.
10.1007/s11606-018-4516-5
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See Article on Publisher Site

Abstract

Capsule Commentary on Silvestri et al., Impact of Cost Display on Ordering Patterns for Hospital Laboratory and Imaging Services Joseph A. Ladapo, MD, PhD David Geffen School of Medicine at UCLA, Los Angeles, CA, USA. J Gen Intern Med 33(8):1383 increasingly concluded that the marginal cost of a lab or DOI: 10.1007/s11606-018-4516-5 imaging test exceeded its marginal benefit. But how well © Society of General Internal Medicine 2018 do physicians know the preferences of their patients? Would a well-informed patient feel similarly to his or her physician about the cost-benefit balance of a test or study? Another interesting issue relates to the decision psychology of interpreting prices. For example, physicians ilvestri et al. evaluated an economics-based intervention may bemorelikelytoorder atestifits priceisadjacentto that is relatively innovative in healthcare but would be 3 another test that is more expensive, and we are all famil- considered commonsense in other fields—namely, providing iar with the purchase-inducing effects of ending prices buyers (physicians) with information about costs of the ser- 4 with the number 9, compared to other numbers. We vices they purchase. Using a pre-post design, they found that should recognize that the study by Silvestri et al. serves displaying costs in the EHR for lab and imaging tests was as a bridge to areas of investigation at the heart of physi- associated with a decrease in the number of studies ordered for cian decision-making and the patient-doctor relationship. hospitalized patients and a decrease in overall lab and imaging costs. Inferences about causal relationships in non-randomized Corresponding Author: Joseph A. Ladapo, MD, PhD; David Geffen studies are fraught with risks. However, initiation of the inter- School of Medicine at UCLA, Los Angeles, CA, USA (e-mail: jladapo@mednet.ucla.edu). vention was associated with a sharp step-off in cost trends, so I am persuaded to believe that it causally influenced physician decision-making. While the effects were quantitatively mod- est, they are substantial at the hospital or health system level, REFERENCES assuming no untoward health effects of decreased testing. 1. Silvestri MT, Xu X, Long T, Bongiovanni T, Bernstein SL, Chaudhry SI, Altogether, these are important findings. Silvestri JI, Stolar M, Greene EJ, Dziura JD, Gross CP, Krumholz HM. But what appears to Bonly^ be a study about cost Impact of Cost Display on Ordering Patterns for Hospital Laboratory and Imaging Services. J Gen Intern Med. DOI: https://doi.org/10.1007/ display is really something much more. The authors’ study s11606-018-4495-6. introduces a trove of scientific areas of inquiry that have 2. Kenneth JA. ‘The economics of agency’ in Principals and agents: The structure of business. In: Pratt JW, Zeckhauser RJ, eds. Boston: Harvard intrigued economists and psychologists alike. The pur- Business School Press;1985:37–51. chase of services by physicians on behalf of patients is 3. Kim J, Novemsky N, Dhar R. Adding small differences can increase really a classic principal-agent problem in economics. In similarity and choice. Psychol Sci 2013;24(2):225–229. 4. Anderson ET, Simester DI. Effects of $9 Price Endings on Retail Sales: providing care, physicians act as agents for their patients, Evidence from Field Experiments. Quant Mark Econ 2003;1(1):93–110. the principals. Implied in the results of Silvestri et al. is that physicians, when presented with cost information, Published online June 4, 2018

Journal

Journal of General Internal MedicineSpringer Journals

Published: Jun 4, 2018

References

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