Does Physician Dispensing Increase Drug Expenditures?

Boris Kaiser and Christian Schmid

Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft

Abstract: We analyze whether the possibility for physicians to dispense drugs increases health care expenditures due to the incentives created by the markup on drugs sold. Using comprehensive physician-level data from Switzerland, we exploit the fact that there is regional variation in the dispensing regime to estimate policy effects. The empirical strategy consists of doubly-robust estimation which combines inverse-probability weighting with regression. Our main finding suggests that if dispensing is permitted, physicians produce significantly higher drug costs in the order of 30% per patient.

Keywords: Health Care Costs; Drug Expenditures; Physician Dispensing; Supply-induced Demand; Treatment Effects (search for similar items in EconPapers)
JEL-codes: C21 I11 I18 (search for similar items in EconPapers)
Date: 2013-07
New Economics Papers: this item is included in nep-hea
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Citations: View citations in EconPapers (3)

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Working Paper: Does Physician Dispensing Increase Drug Expenditures? (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ube:dpvwib:dp1303

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