All FSI News News November 15, 2022

Physicians or Nurse Practitioners: Evidence From the Emergency Department

In this National Bureau of Economic Research working paper, Stanford Health Policy's David Chan and Yiqun Chen consider the productivity of emergency room physicians vs. nurse practitioners.
An illustration of someone taking a pulse
Getty Images

ABSTRACT: Professions play a key role in determining the division of labor and the returns to skilled work. This paper studies the productivity difference between physicians and nurse practitioners (NP), two health care professions performing overlapping tasks but with stark differences in background, training, and pay. Using data from the Veterans Health Administration and quasi-experimental variation in the patient probability of being treated by physicians versus NPs in the emergency department, we find that, compared to physicians, NPs significantly increase resource utilization but achieve worse patient outcomes. We find evidence suggesting mechanisms relating to lower human capital among NPs relative to physicians and worker-task assignment responding to the lower skill of NPs. Counterfactual analysis suggests a net increase in medical costs with NPs, even when accounting for NPs' wages that are half as much as physicians'. Despite large productivity differences between professions, we find even larger productivity differences within professions and substantial productivity overlap between professions. Yet there is little overlap in wages between NPs and physicians and, within professions, no significant correlation between productivity and wages.

Freakonomics MD logoDavid Chan joins Freakonomics MD's Bapu Jena to discuss his study on physicians vs. nurse practitioners.

Listen to the Full Interview or Read the Transcript.

  

We find that on average, NPs use more resources in the emergency department settings. They keep patients longer and they spend more resources measured in dollars.
David Chan
Associate Professor of Health Policy

David Chan

Associate Professor of Health Policy
Studies how information affects productivity and design of health care.
David Chan is an Associate Professor at Stanford Health Policy