Saving Lives by Tying Hands: The Unexpected Effects of Constraining Health Care Providers

Jonathan Gruber, Thomas P. Hoe and George Stoye
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Jonathan Gruber: MIT and NBER
Thomas P. Hoe: Cornell University and Institute for Fiscal Studies

The Review of Economics and Statistics, 2023, vol. 105, issue 1, 1-19

Abstract: We study how emergency department (ED) doctors respond to incentives to reduce wait times. We use bunching techniques to study an English policy that imposed strong incentives to treat patients within four hours. The policy reduced time spent in the ED by 21 minutes for affected patients yet caused doctors to increase treatment intensity and admit more patients. We find a striking 14% reduction in mortality. Analysis of patient severity and hospital crowding strongly suggests it is the wait time reduction that saves lives. We conclude that, despite distorting medical decisions, constraining ED doctors can induce cost-effective reductions in mortality.

Date: 2023
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https://doi.org/10.1162/rest_a_01044

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Working Paper: Saving Lives by Tying Hands: The Unexpected Effects of Constraining Health Care Providers (2018)
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