IFS Working Paper (W16/21)

Choice in the presence of experts: the role of general practitioners in patients' hospital choice

Date: 14 November 2016
Publisher: The IFS
DOI: 10.1920/wp.cem.2016.1621

This paper considers the micro-econometric analysis of patients' hospital choice for elective medical procedures when their choice set is pre-selected by a general practitioner (GP). It proposes a two-stage choice model that encompasses both, patient and GP level optimization, and it discusses identifi cation. The empirical analysis demonstrates biases and inconsistencies that arise when strategic pre-selection is not properly taken into account. We fi nd that patients defer to GPs when assessing hospital quality and focus on tangible attributes, like hospital amenities; and that GPs, in turn, as patients'
agents present choice options based on quality, but as agents of health authorities also consider their financial implications.