Behavioral Economics and Low Value Care

Dec 13, 2013, 8:00 AM, Posted by Pioneer Blog Team

Doctors go over a patient's charts in the emergency room.

A few weeks ago, I had the pleasure of attending a conference co-hosted by RWJF, Donaghue Foundation, and the Center for Health Incentives and Behavioral Economics at the Leonard Davis Institute at the University of Pennsylvania. I attended the conference excited to learn more about the prospect of applying behavioral economics concepts to reduce use of low-value health care and to hear about the work of our grantees.

A major theme from the first day of the conference was the importance of testing our behavioral economics assumptions. One of the keynote speakers, Michael Hallsworth of the UK’s “nudge unit” presented on their process as a governmental behavioral economics insights team, and we learned just how surprising results from behavioral economics experiments can be. The key takeaway: in designing interventions, it's not enough to apply a rule, we have to experiment and question our assumptions.

This rapid-cycle testing approach seemed to be a hand-in-glove fit with what we have been learning works in health care quality improvement. Research and experience has demonstrated that there are a tremendous number of factors that lead to a default of doing more, and that reward providers for prescribing low-value health care services. As such, this area is ripe for testing interventions to counterbalance these incentives, and we hope that behavioral economics could offer new insights to understand how to move from measurement to action.

Grantees exploring low-value health care presented throughout the second day. The group’s discussions often veered into how, when, where, and under what circumstances we make decisions about low-value health care.

Health care decisions are among the most complex choices we make, and information asymmetry abounds. Patients don’t always understand the risks of harms from doing more, and are already making decisions with less medical information and context than their doctors have. Providers also don’t always have the information that they need—about their patient’s values and preferences, or sometimes even about the latest medical studies and guidelines.

For the most part, health care decisions are made quickly, in a health care setting, away from decision-support resources, under tremendous time pressure, and in a context of decision fatigue. The projects we learned about aim to move complex decisions out of this environment as a way to reduce use of low-value health care service, using behavioral economics tactics such as securing “pre-commitments” from physicians or patients to avoid the use of low-value services, rethinking the way we use incentives to increase advance planning for end-of-life care, or by making use of interventions that guard against decision fatigue.

These interventions focus on ways to tap into providers' and patients' intrinsic motivations, rather than relying on monetary incentives alone, and to move critical decision-points to times when providers and patients have more resources at hand—resources like time and clear information. They turn traditional economic interventions on their heads, and challenge us to think beyond paying piecemeal for every behavior we want to see.

I look forward to learning their potentially surprising results next year!

Emmy Ganos, PhD, joined the Robert Wood Johnson Foundation in 2013 as a program associate on the Quality/Equality team. She brings her extensive research experience in public and community health to her work at RWJF, and relishes the opportunity the Foundation provides to apply her expertise to “working on the cutting-edge to improve health and health care.”