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Physician altruism and moral hazard: (no) evidence from Finnish national prescriptions data

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Finland paper 2018 November 26th_IL.docxAccepted version189.3 kBMicrosoft WordView/Open
Title: Physician altruism and moral hazard: (no) evidence from Finnish national prescriptions data
Authors: Crea, G
Galizzi, M
Linnosmaa, I
Miraldo, M
Item Type: Journal Article
Abstract: We test the physicians’ altruism and moral hazard hypotheses using a national panel register containing all 2003–2010 statins prescriptions in Finland. We estimate the likelihood that physicians prescribe generic versus branded versions of statins as a function of the shares of the difference between what patients have to pay out of their pocket and what is covered by the insurance, controlling for patient, physician, and drug characteristics. We find that the estimated coefficients and the average marginal effects associated with moral hazard and altruism are nearly zero, and are orders of magnitude smaller than the ones associated with other explanatory factors such as the prescriptions’ year and the physician specialization. When the analysis distinctly accounts for both the patient and the insurer shares of expenditure, the estimated coefficients directly reject the altruism and moral hazard hypotheses. Instead, we find strong and robust evidence of habits persistence in prescribing branded drugs.
Issue Date: 1-May-2019
Date of Acceptance: 16-Mar-2019
URI: http://hdl.handle.net/10044/1/69537
DOI: https://dx.doi.org/10.1016/j.jhealeco.2019.03.006
ISSN: 0167-6296
Publisher: Elsevier
Start Page: 153
End Page: 169
Journal / Book Title: Journal of Health Economics
Volume: 65
Copyright Statement: © 2019 Published by Elsevier B.V. This manuscript is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Licence http://creativecommons.org/licenses/by-nc-nd/4.0/
Sponsor/Funder: National Institute for Health and Welfare (THL)
Funder's Grant Number: 30121 DRUGA
Keywords: Habits persistence
Moral hazard
Pharmaceuticals
Physician altruism
1402 Applied Economics
1117 Public Health and Health Services
Health Policy & Services
Publication Status: Published
Online Publication Date: 2019-03-16
Appears in Collections:Imperial College Business School