Fee for Service overtreatment recommendations:

Health and medical care is complicated.  Patients have a hard time figuring out the quality of information that a medical professional gives to them.  They also have a hard time figuring out what appropriate treatment is.  There is a pretty cool little study from Switzerland that quantifies the informational challenge for patients.**

In our study, a single test patient visits 180 randomly selected dentists for a checkup. At each dentist visit, the test patient asked for a diagnosis based on an examination and the same x-ray photograph, a treatment recommendation and a cost estimate. The test patient had a superficial caries lesion limited to the enamel which should not be treated with an invasive treatment such as a filling according to the Swiss Dental Guidelines and four cooperating reference dentists. Thus, we focus our analysis with the case at hand at the credence goods problem of overtreatment which wastes resources and may spur adverse health effects in the long run….

Our central result is an overtreatment recommendation rate of 28% (50/180). Conditional on an overtreatment recommendation, mean overtreatment costs taken from the collected cost estimates amount to CHF 535 (about $550), the median being lower at CHF 444 (about $455). Regarding the treatment the test patient has a supercial interproximal caries lesion that should not be treated by an invasive treatment such as a filling, the suggested number of fillings at a dentist ranges from 1 to 6. Furthermore, we observe that 13 different teeth to be treated with a filling appear across all cost estimates. Thus, besides our finding of
a considerable overtreatment recommendation rate, we also observe a striking heterogeneity in the treatment recommendations.

Almost three in ten dentists give the patient bad information and the quality of bad information varied greatly.

If the overtreating dentists all recommended that the same single tooth be filled then the information problem barely exists.  It would be a uniform recommendation towards a single non-concordant standard of care.  They might have been dentists that figure that sooner or later a cavity will need to be filled on a tooth and it might as well be them collecting the fee instead of their competitor. In that story, it would be a time and location shifting of costs.

But that is not the story being told in the data.  The over-treating dentists made a wide range of recommendations.  Some may have been merely slightly more aggressive than guideline concordant care.  Others were taking advantage of the information problem as they recommended multiple fillings on multiple, varying teeth.

So what does this mean?

The dismissive answer is that Swiss dentists are dishonest and that is all one can say.  I don’t think that is the meaning that can be pulled from this study.

Instead, the information problem is real and meaningful.  People trust their dentists and doctors to look out for their best interests.  But there is an inherent incentive conflict in a fee for service system where not treating or minimally treating can be a short term money loser.  The majority of Swiss dentists in this study are honest.  That honesty might be because of internal ethics and professional pride or it might be because those dentists realize that they are in market that values reputation and they want the long run profitable reputation of being honest.

Good car mechanics also face a market that values reputation .  They get paid by the number of things that they fix.  Replacing the entire clutch on a 1983 VW Rabbit generates more revenue than changing the linkage between the stick and the clutch on the same care.  I used the same mechanic for twelve years in Pittsburgh because in 2005 he told my fiance that he could do $1,900 worth of work to get her car to pass inspection and have it fall apart in six months or he could do $125 worth of work to get it safe enough to run for a month while we figured out what to do next.  Over the next twelve years, he was always outlining the trade-offs and sending us to other garages that could do specialized work the he was capable of doing but not as well or not as affordably.  Other mechanics would have been happy doing the $1,900 in short term work and calling it a day.

Searching and finding an honest mechanic, an honest dentist or an honest doctor when they all get paid on a fee for service basis and then verifying their honesty is expensive and challenging.  The incentives line up for some short term profit taking on the provider side.  Under this economic structure, we have to hope that professional ethics and a long shadow of the future will encourage honesty but that is hard to verify.  And if a dentist says that Tooth #22 needs a filling, most people don’t have the expertise to actually contest that recommendation unless they can get a professional second opinion from a known to be honest dentist.

 

 

** Gottschalk, F., Mimra, W., & Waibel, C. (2017). Health Services as Credence Goods: A Field Experiment. SSRN Electronic Journal. doi:10.2139/ssrn.3036573