--- title: "Impact of competing fees on MD behavior. | Sutter Health" description: "Societal savings from Medicare procedure fee reductions are overstated if one does not also consider spillover effects in the private insurance market." url: "https://www.sutterhealth.org/research/publications/impact-competing-fees-md-behavior-1055312609" --- 1. [Home](https://www.sutterhealth.org/) / 2. [Research](https://www.sutterhealth.org/research) / 3. [Research publications](https://www.sutterhealth.org/research/publications) / 4. Impact of competing fees on MD behavior. # A tale of two bounties: the impact of competing fees on physician behavior. Rice T, Stearns SC, Pathman DE, DesHarnais S, Brasure M, & Tai-Seale M. _J Health Polit Policy Law. 24(6):1307-30._ 1999-12-01 ## Abstract This study examines how the volume of privately insured services provided in hospital inpatient and outpatient departments changes in response to reductions in Medicare physician payments. We hypothesize that physicians consider relative payment rates when choosing which patients to treat in their practices. When Medicare reduces its payments for surgical procedures, as it did in the late 1980s, physicians are predicted to treat more privately insured patients because they become more lucrative. We use data from 182 hospitals for seventeen major procedures groups, covering a forty-five-month period between 1988 and 1991 that encompasses a twenty-four-month period before the reduction in Medicare fees and twenty-one months after the reduction. Our findings are consistent with the predictions for a number of procedure groups, but not for all of them. One implication of the findings is that societal savings from Medicare fee reductions are overstated if one does not also consider spillover effects in the private insurance market. [PubMed abstract](https://www.ncbi.nlm.nih.gov/pubmed/?term=rice%2C+stearns%2C+pathman%2C+1999) ## Research topics - [Aging and Longevity](https://www.sutterhealth.org/research-search-results?query=%22%5C%22Aging+and+Longevity%5C%22%22) - [Health Policy](https://www.sutterhealth.org/research-search-results?query=%22%5C%22Health+Policy%5C%22%22) - [Medical Informatics](https://www.sutterhealth.org/research-search-results?query=%22%5C%22Medical+Informatics%5C%22%22) ## Related publications [View all publications](https://www.sutterhealth.org/research-search-results?verticalKey=research_publication) - Publication ### [Volume responses to Medicare payment reductions with multiple payers: a test of the McGuire-Pauly model.](https://www.sutterhealth.org/research/publications/vol-responses-medicare-paymt-reduced-many-payers-1055312302) Tai-Seale M, Rice TH, Stearns SC. Health Econ. 1998 May;7(3):199-219. 1998 May 01 - Publication ### [Patient experiences in selecting a Medicare Part D prescription drug plan.](https://www.sutterhealth.org/research/publications/pt-experiences-selecting-medicare-part-d-rx-drug-plan-1055312300) Stults CD, Baskin AS, Bundorf MK, Tai-Seale M. J Patient Experience. https://doi.org/10.1177/2374373517739413 2017 Nov 21 - Publication ### [Medicare annual preventive care visits: use increased among fee-for-service patients, but many do not participate.](https://www.sutterhealth.org/research/publications/medicare-preventive-care-in-fee-for-svce-pts-1055312874) Chung S, Lesser LI, Lauderdale DS, Johns NE, Palaniappan LP, Luft HS. Health Aff (Millwood). 34(1):11-20. doi: 10.1377/hlthaff.2014.0483. 2015 Jan 01 - Publication ### [Multiple locations of advance care planning documentation in an electronic health record: are they easy to find?](https://www.sutterhealth.org/research/publications/advance-care-planning-documents-in-ehr-locatable-1055312697) Wilson CJ, Newman J, Tapper S, Lai S, Cheng PH, Wu FM, Tai-Seale M. J Palliat Med. 16(9):1089-94. doi: 10.1089/jpm.2012.0472. Epub 2013 Jun 6. 2013 Sep 01 - Publication ### [Determinants of generic drug substitution in the United States.](https://www.sutterhealth.org/research/publications/determinants-of-generic-drug-substitution-in-the-us-1055312368) Segal JB, Onasanya O, Daubresse M, Lee CY, Moechtar M, Pu X, Dutcher SK, Romanelli RJ. Ther Innov Regul Sci. 2168479018820050. doi: 10.1177/2168479018820050. \[Epub ahead of print\] 2019 Jan 13 [View all publications](https://www.sutterhealth.org/research-search-results?verticalKey=research_publication) ```json {"@context":"https://schema.org","@type":"MedicalOrganization","name":"Sutter Health","@id":"https://www.sutterhealth.org/#medicalorganization","url":"https://www.sutterhealth.org","logo":"https://www.sutterhealth.org/static/images/sutter-health-logo.svg","address":{"@type":"PostalAddress","streetAddress":"2200 River Plaza Drive","addressLocality":"Sacramento","addressRegion":"CA","postalCode":"95833","addressCountry":"US"},"areaServed":{"@type":"AdministrativeArea","name":"California"},"sameAs":["https://www.facebook.com/SutterHealth","https://www.instagram.com/sutterhealth/","https://x.com/SutterHealth","https://www.youtube.com/sutterhealth","https://www.linkedin.com/company/sutter-health","https://en.wikipedia.org/wiki/Sutter_Health"]} ``` ```json {"@context":"https://schema.org","@type":"BreadcrumbList","@id":"https://www.sutterhealth.org/research/publications/impact-competing-fees-md-behavior-1055312609#breadcrumblist","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https://www.sutterhealth.org/"},{"@type":"ListItem","position":2,"name":"Research","item":"https://www.sutterhealth.org/research"},{"@type":"ListItem","position":3,"name":"Research publications","item":"https://www.sutterhealth.org/research/publications"},{"@type":"ListItem","position":4,"name":"Impact of competing fees on MD behavior."}]} ``` ```json {"@context":"https://schema.org","@type":"MedicalScholarlyArticle","@id":"https://www.sutterhealth.org/research/publications/impact-competing-fees-md-behavior-1055312609#medicalscholarlyarticle","name":"A tale of two bounties: the impact of competing fees on physician behavior.","headline":"Impact of competing fees on MD behavior.","abstract":"This study examines how the volume of privately insured services provided in hospital inpatient and outpatient departments changes in response to reductions in Medicare physician payments. 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