What’s the Going Rate? Examining Variations in Private Payments to Physicians

Posted: September 25, 2013 in Uncategorized
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Physicians everywhere are getting paid different amounts for administering the same treatments. This is sometimes because the cost of living varies from place to place, but there are other factors that haven’t been researched yet. Stanford health policy experts have teamed up to find answers. What they found was interesting; some doctors were paid twice the amount as others to perform the same procedures. This wasn’t due to characteristics of the patient or the physician, but mostly due to the geographic area.

Michelle Brandt talked with Laurence Baker of Stanford to ask a few questions about the findings in the study. Brandt asks:

1. Were you surprised by what you found?

It was surprising to them that there weren’t more explainable factors. The variations in price were large regardless of how routine the procedure was.

2. Did you expect geography to be more of or less of a factor?

Baker expected it to be more of a factor, but there needs to be more investigating.

3. Why is a better understanding of price variation important?

It is important to know why things are priced so differently because there could be a market power controlling prices which is bad for consumers, according to Baker. There can be improvements made in the system when patterns are examined.

4. Your analysis was done on claims from 2007, well before health reforms took effect. Do you think your findings would be different if you examined claims from this (or next) calendar year?

The professionals don’t believe prices are going to change any time soon due to health reform. The only change might be prices will become more transparent to patients.

5. What are you next steps in regard to this line of work?

They plan to focus projects on measuring large practice effects on prices and hospitals effect on prices.


To read the entire interview head to:



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