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AER - Previous Issues
 AER - June 2007

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American Economic Review

Vol. 97, No. 3, June 2007

Tradeoffs from Integrating Diagnosis and Treatment in Markets for Health Care
Christopher C. Afendulis and Daniel P. Kessler

Article Citation
Afendulis, Christopher C., and Daniel P. Kessler 2007. "Tradeoffs from Integrating Diagnosis and Treatment in Markets for Health Care." American Economic Review, 97(3): 1013–1020.
DOI:10.1257/aer.97.3.1013

Abstract
To identify the important tradeoffs in consulting a single expert for both diagnosis and treatment, we examine the costs and health outcomes of elderly Medicare beneficiaries with coronary artery disease. We compare the empirical consequences of diagnosis by cardiologists who can provide surgical treatment – "integrated" cardiologists – to the consequences of diagnosis by a nonintegrated cardiologist. Diagnosis by an integrated cardiologist leads, on net, to higher health spending but similar health outcomes. The net effect contains three components: reduced spending and improved outcomes from better allocation of patients to surgical treatment options; increased spending conditional on treatment option; and worse outcomes from poorer provision of nonsurgical care. (JEL I11, I18)

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Authors
Afendulis, Christopher C.
Kessler, Daniel P.