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Abstract: The United States cannot afford its healthcare system as it
currently stands. Society must soon decide on how to reform Medicare, which contributes to
over 47% of healthcare spending in the United States (Klees, Wolf, and Curtis 2010). Some
of Medicare's excess spending stems from the overutilization of treatments. In this paper,
a modified physician induced demand model is developed ... read moreto better understand physician
incentives. In particular, the model predicts that when the standard of care appears
ambiguous, the effects of inducement are diminished, and physicians are incentivized to
lead their patients to the most expensive course of treatment. The use of intensity
modulated radiation therapy (IMRT) on low-grade prostate cancer patients is the perfect
context in which to test this model. The results show that the probability that a patient
is treated with IMRT decreases by about 85% when reimbursement is cut by
30%.
Thesis (M.S.)--Tufts University, 2011.
Submitted to the Dept. of Economics.
Advisor: Jeffrey Zabel.
Committee: Emilia Simeonova, and Constantine Mantz.
Keyword: Economics.read less
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