HSE Seminar on Political Economy: Heike Hennig-Schmid (Laboratory for Experimental Economics University of Bonn) about the dishonesty in healthcare practice

Heike Hennig-Schmid analyzed the effect of a random audit including fines on individuals' honesty by means of a novel controlled behavioral experiment framed in a neonatal care context. He found evidence that individual characteristics (gender, medical background, integrity) are related to dishonest behavior. 

Topic: Dishonesty in healthcare practice: A behavioral experiment on upcoding in neonatology

joint work with Hendrik Jürges,  Daniel Wiesen

Abstract:

Dishonest behavior signicantly increases the cost of medical care provision. Upcoding of patients is a common form of fraud to attract higher reimbursements. Imposing audit mechanisms including fines to curtail upcoding is widely discussed among healthcare policy-makers. How audits and fines affect individual health care providers' behavior is empirically not well understood. To provide new evidence on fraudulent behavior in health care, we analyze the effect of a random audit including fines on individuals' honesty by means of a novel controlled behavioral experiment framed in a neonatal care context. Prevalent dishonest behavior declines signicantly when audits and fines are introduced. The effect is driven by a reduction in upcoding when being detectable. Yet, upcoding increases when not being detectable as fraudulent. We find evidence that individual characteristics (gender, medical background, integrity) are related to dishonest behavior. Policy implications are discussed.

the joint seminar of Higher School of Economics on political economy, International Center for the Study of Institutions and Development (ICSID) and NES Center for the Study of Diversity and Social Interaction (NES CSDSI) was held on October 09.

Moderators: Alexei Zakharov (HSE), Konstantin Sonin (HSE, The University of Chicago Harris School of Public Policy)