What determines whether or not a doctor prescribes a stent?

Inappropriate Stent Procedures Decline, Study Shows
by: Ron Winslow
Nov 10, 2015
Click here to view the full article on WSJ.com

TOPICS: Health Economics

SUMMARY: A new study suggests cardiologists have curbed overuse of a flagship procedure for treating heart disease that has been cited as a high-profile example of waste in the U.S. health care system.

CLASSROOM APPLICATION: The article offers two interesting economic issues associated with stent implant decisions. First, "upcoding" may explain the reason for the measured reduction, but not an actual reduction, in unnecessary stent implants. The incentive issue is whether doctors are implanting stents for financial gains, despite the possibility that the costs of doing so outweigh the benefits. "But concern arose about a decade ago that many cardiologists were implanting the devices in patients with stable disease and few if any symptoms." Second, "Several studies, including a large trial called Courage, challenged whether the benefits of stents in such patients outweighed the risks and questioned the economic cost to patients and the health system. By some estimates, one in six stent procedures was inappropriate, sparking criticism of cardiologists and prompting calls to rein in use of the devices."

QUESTIONS: 
1. (Introductory) Do physicians have an incentive to overuse certain medical procedures like stent implantation?

2. (Advanced) What is "upcoding"? What is the incentive of a doctor ordering a stent implant on a patient to upcode?

3. (Advanced) How would an economist measure whether upcoding is a response to a change in medical policy or reimbursements for procedures?

Reviewed By: James Dearden, Lehigh University