Physician Productivity in the United States: Managerial, Organizational, and Policy Implications

This paper addresses several dimensions of physician productivity in the United States: (a) the concept itself and different measures of productivity; (b) the role(s) of public policy in shaping physician productivity; (c) theory and evidence regarding the effects of policy and other external factors on physician productivity; (d) a future research agenda to fill the gaps in theory and the relevant evidence base; and (e) suggested strategies for increasing physician productivity. I will argue that productivity metrics will differ, quite appropriately, based on the perspective of different stakeholders. The principal forces driving productivity will be discussed under the headings of behavioral incentives, structure, process, and technology; and I will posit that the effect of legislation and public policy on physician productivity is inherently likely to be relatively modest. The available evidence from cost and production function studies points to input mix, scale, and incentives as sigtnificant determinants of physician productivity, but there are several limitations in the extant data base -- failure to adjust for patient case mix differences, imprecise measures of inputs (especially physical capital and information technology), cross-sectional data that fails to capture technical change over time, and crude measures of physician output. The paper outlines a research agenda to address these shortcomings and concludes with a set of proposed strategies for increasing physician productivity in the United States.