Does Physician Over-Service Improve the Quality of Care? A Standardised Patient Audit Study

Abstract

Physicians’ “know-do gaps” are a key factor driving the poor quality of healthcare in many developing countries, but there is little guidance on how to address these gaps. We designed a standardised patient audit study in China to evaluate the impact of physician over-service on their investment in learning and disease management decisions. We find that physicians’ total over-service leads to a 19.2%, 15.6% and 10.8% significant increase in consultation length, adherence to checklists, and patient-centred communication, respectively, but no significant improvement in giving a correct diagnosis, drug prescription or referral. The effects on physicians’ investment in learning are driven by over-service in drug prescription rather than over-service in medical tests. Moreover, over-service in drug prescription significantly leads to a 28.0 percentage-point increase in the prescription of a correct drug. Our findings imply that physician over-service reduces their “know-do gaps” and improves healthcare quality despite the related inefficient use of medical resources.JEL classificationD82; H75; I10; I11; I18; J45