Doctor's Diagnostic Skill, Procedural Skill and Unnecessary C-Sections

This paper develops and applies a model of in which doctors have two dimensions of skill: diagnostic skill and skill performing procedures. Higher procedural skill increase the use of intensive procedures across the board, while better diagnostic skill results in fewer intensive procedures for the low risk, but more for the high risk. Deriving empirical analogues to our theoretical measures for the case of C-section, we show that improving diagnostic skill would reduce C-section rates by 15.8% among the lowest risk, and increase them by 4.7% among the high risk while improving outcomes among all women. ∗We thank Samantha Heep and Dawn Koffman for excellent research assistance, and Amitabh Chandra, Jonathan Gruber, Amy Finkelstein, Kate Ho, Robin Lee, Jonathan Skinner and seminar participants at Princeton, Georgetown University, Havard Medical School, Kyoto University, NYU, the Japanese National Institute of Population and Social Security Research, Warwick University, University College London, the London School of Economics, the Paris School of Economics, the NBER Summer Institute, and the University of Michigan for helpful comments. This research was supported by a grant from the Program on U.S. Health Policy of the Center for Health and Wellbeing.