The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery

David  Cutler; Robert S. Huckman; Mary Beth  Landrum

}
//]]>
</script>
<input type="hidden" name="__VIEWSTATEGENERATOR" id="__VIEWSTATEGENERATOR" value="E39AC016" />
<script type="text/javascript">RegisterSod("sp.core.js", "\u002f_layouts\u002fsp.core.js?rev=7ByNlH\u00252BvcgRJg\u00252BRCctdC0w\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("sp.res.resx", "\u002f_layouts\u002fScriptResx.ashx?culture=en\u00252Dus\u0026name=SP\u00252ERes\u0026rev=b6\u00252FcRx1a6orhAQ\u00252FcF\u00252B0ytQ\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("sp.ui.dialog.js", "\u002f_layouts\u002fsp.ui.dialog.js?rev=Tpcmo1\u00252FSu6R0yewHowDl5g\u00253D\u00253D");RegisterSodDep("sp.ui.dialog.js", "sp.core.js");RegisterSodDep("sp.ui.dialog.js", "sp.res.resx");</script><script type="text/javascript">RegisterSod("core.js", "\u002f_layouts\u002f1033\u002fcore.js?rev=Emb5hNX1RZMNXk9oS82yvA\u00253D\u00253D");</script>
<script type="text/javascript">
//<![CDATA[
var _spFormDigestRefreshInterval = 1440000;window.g_updateFormDigestPageLoaded = new Date(); window.g_updateFormDigestPageLoaded.setDate(window.g_updateFormDigestPageLoaded.getDate() -5);function loadMDN2() { EnsureScript('MDN.js', typeof(loadFilterFn), null); }
function loadMDN1() { ExecuteOrDelayUntilScriptLoaded(loadMDN2, 'sp.ribbon.js'); }
_spBodyOnLoadFunctionNames.push('loadMDN1');//]]>
</script>
<script type="text/javascript">RegisterSod("sp.runtime.js", "\u002f_layouts\u002fsp.runtime.js?rev=IGffcZfunndj0247nOxKVg\u00253D\u00253D");RegisterSodDep("sp.runtime.js", "sp.core.js");RegisterSodDep("sp.runtime.js", "sp.res.resx");</script><script type="text/javascript">RegisterSod("sp.js", "\u002f_layouts\u002fsp.js?rev=\u00252B4ZEyA892P3T0504qi0paw\u00253D\u00253D");RegisterSodDep("sp.js", "sp.core.js");RegisterSodDep("sp.js", "sp.runtime.js");RegisterSodDep("sp.js", "sp.ui.dialog.js");RegisterSodDep("sp.js", "sp.res.resx");</script><script type="text/javascript">RegisterSod("cui.js", "\u002f_layouts\u002fcui.js?rev=OOyJv78CADNBeet\u00252FvTvniQ\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("inplview", "\u002f_layouts\u002finplview.js?rev=WB6Gy8a027aeNCq7koVCUg\u00253D\u00253D");RegisterSodDep("inplview", "core.js");RegisterSodDep("inplview", "sp.js");</script><script type="text/javascript">RegisterSod("ribbon", "\u002f_layouts\u002fsp.ribbon.js?rev=F\u00252BUEJ66rbXzSvpf7nN69wQ\u00253D\u00253D");RegisterSodDep("ribbon", "core.js");RegisterSodDep("ribbon", "sp.core.js");RegisterSodDep("ribbon", "sp.js");RegisterSodDep("ribbon", "cui.js");RegisterSodDep("ribbon", "sp.res.resx");RegisterSodDep("ribbon", "sp.runtime.js");RegisterSodDep("ribbon", "inplview");</script><script type="text/javascript">RegisterSod("sp.ui.policy.resources.resx", "\u002f_layouts\u002fScriptResx.ashx?culture=en\u00252Dus\u0026name=SP\u00252EUI\u00252EPolicy\u00252EResources\u0026rev=YhBHGmUAGyJ3lAgSdE4V\u00252Fw\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("mdn.js", "\u002f_layouts\u002fmdn.js?rev=gwmFFJ2\u00252FfFacqXWAqG\u00252FqKg\u00253D\u00253D");RegisterSodDep("mdn.js", "sp.core.js");RegisterSodDep("mdn.js", "sp.runtime.js");RegisterSodDep("mdn.js", "sp.js");RegisterSodDep("mdn.js", "cui.js");RegisterSodDep("mdn.js", "ribbon");RegisterSodDep("mdn.js", "sp.ui.policy.resources.resx");</script>
<script type="text/javascript">
//<![CDATA[

function _spNavigateHierarchyEx(nodeDiv, dataSourceId, dataPath, url, listInContext, type, additionalQString) {
    SetAdditionalNavigateHierarchyQString(additionalQString);
    g_originalSPNavigateFunc(nodeDiv, dataSourceId, dataPath, url, listInContext, type);
}

g_originalSPNavigateFunc = _spNavigateHierarchy;
_spNavigateHierarchy = _spNavigateHierarchyEx;
var _fV4UI = true;//]]>
</script>
<script type="text/javascript">RegisterSod("msstring.js", "\u002f_layouts\u002f1033\u002fmsstring.js?rev=QtiIcPH3HV7LgVSO7vONFg\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("browserScript", "\u002f_layouts\u002f1033\u002fnon_ie.js?rev=EVTj1bu32\u00252FMla6SDN\u00252FsNTA\u00253D\u00253D");</script>
<script type="text/javascript">
//<![CDATA[
var __wpmExportWarning='This Web Part Page has been personalized. As a result, one or more Web Part properties may contain confidential information. Make sure the properties contain information that is safe for others to read. After exporting this Web Part, view properties in the Web Part description file (.WebPart) by using a text editor such as Microsoft Notepad.';var __wpmCloseProviderWarning='You are about to close this Web Part.  It is currently providing data to other Web Parts, and these connections will be deleted if this Web Part is closed.  To close this Web Part, click OK.  To keep this Web Part, click Cancel.';var __wpmDeleteWarning='You are about to permanently delete this Web Part.  Are you sure you want to do this?  To delete this Web Part, click OK.  To keep this Web Part, click Cancel.';//]]>
</script>
</form>

Go to main content

Article | American Economic Review | May 2004

The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery

by David Cutler, Robert S. Huckman and Mary Beth Landrum

Keywords: Information; Health; Markets; Theory; Outcome or Result;

Format: Print

5 pages

Find at Harvard Read Now

Citation:

Cutler, David, Robert S. Huckman, and Mary Beth Landrum. "The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery." American Economic Review 94, no. 2 (May 2004): 342–346. (Papers and Proceedings.)

About the Author

Robert S. Huckman

Albert J. Weatherhead III Professor of Business Administration
Chair, MBA Required Curriculum

Technology and Operations Management

View Profile »
View Publications »

More from the Author

Case | HBS Case Collection | October 2018 (Revised April 2019)

The Brigham and Women's Hospital Innovation Hub: Driving Internal Innovation

Ariel D. Stern and Robert S. Huckman

Keywords: healthcare; innovation; hospital; health; health care;

Citation:
Stern, Ariel D., and Robert S. Huckman. "The Brigham and Women's Hospital Innovation Hub: Driving Internal Innovation." Harvard Business School Case 619-026, October 2018. (Revised April 2019.) View Details

Cite View Details Educators Related
Case | HBS Case Collection | October 2016 (Revised March 2019)

Carrum Health: Scaling Bundled Payments

Robert S. Huckman and Sarah Mehta

Founded in 2014, Carrum Health helped self-insured employers located in three markets (San Diego, California; Seattle, Washington; and San Francisco, California) save money on their employees’ planned surgeries. It did so by contracting directly with top-quality hospitals located within the area, and negotiating a set fee (known as a bundled payment) for each of five common surgical procedures: knee replacement, hip replacement, cervical spinal fusion, lumbar spinal fusion, and coronary bypass. By 2016, the company was growing steadily and saving its clients over 40% on average on these five procedures.
In September 2016, Sachin Jain, Carrum’s CEO, received an email from North Beach Apparel, a large retailer based in San Francisco with a growing presence near Chicago, Illinois and Columbus, Ohio. North Beach was ready to partner with Carrum, but the terms of the deal required Carrum to enter the Chicago and Columbus markets in order to serve all North Beach employees. The deal would significantly increase Carrum’s revenue and begin to move the entrepreneurial venture closer to profitability. However, by expanding to Chicago and Columbus, the young company ran the risk of spreading itself too thin, especially given the opportunity for growth in Carrum’s current three markets. But Jain knew that if he waited too long to expand geographically, Carrum might lose its first-mover advantage in several markets. With limited resources, Jain needed to decide how to scale his young company: should Carrum enter the Chicago and Columbus markets with a guaranteed initial client base and then focus on selling the existing five bundles to new customers there; or, should the company add new bundles to its product line through the existing provider networks in the three markets it currently served?

Keywords: health financing; health insurance; value-based healthcare reimbursements; bundled payments; innovation; Scale; Health; Health Care and Treatment; Cost Management; Growth and Development Strategy; Decision Choices and Conditions; Health Industry; California; San Francisco; San Diego; Seattle;

Citation:
Huckman, Robert S., and Sarah Mehta. "Carrum Health: Scaling Bundled Payments." Harvard Business School Case 617-017, October 2016. (Revised March 2019.) View Details

Cite View Details Educators Related
Article | Management Science | September 2018

Discretionary Task Ordering: Queue Management in Radiological Services

Maria Ibanez, Jonathan R. Clark, Robert S. Huckman and Bradley R. Staats

Work-scheduling research typically prescribes task sequences implemented by managers. Yet employees often have discretion to deviate from their prescribed sequence. Using data from 2.4 million radiological diagnoses, we find that doctors prioritize similar tasks (batching) and those tasks they expect to complete faster (shortest expected processing time). Moreover, they exercise more discretion as they accumulate experience. Exploiting random assignment of tasks to doctors’ queues, instrumental variable models reveal that these deviations erode productivity. This productivity decline lessens as doctors learn from experience. Prioritizing the shortest tasks is particularly detrimental to productivity. Actively grouping similar tasks also reduces productivity, in stark contrast to productivity gains from exogenous grouping, indicating deviation costs outweigh benefits from repetition. By analyzing task completion times, our work highlights the tradeoffs between the time required to exercise discretion and the potential gains from doing so, which has implications for how discretion over scheduling should be delegated.

Keywords: discretion; scheduling; queue; healthcare; learning; experience; Decentralization; operations; service operations; service delivery; Performance; Performance Effectiveness; Performance Efficiency; Performance improvement; Performance Productivity; Decisions; time management; Cost vs Benefits; Health Industry; Operations; Service Operations; Service Delivery; Performance; Performance Effectiveness; Performance Efficiency; Performance Improvement; Performance Productivity; Decisions; Time Management; Cost vs Benefits; Health Industry;

Citation:
Ibanez, Maria, Jonathan R. Clark, Robert S. Huckman, and Bradley R. Staats. "Discretionary Task Ordering: Queue Management in Radiological Services." Management Science 64, no. 9 (September 2018): 4389–4407. (Working paper available here. Winner of the 2017 Best Paper Competition of the POMS College of Healthcare Operations Management. Featured in Forbes, Quartz, and Inc.) View Details

Cite View Details SSRN Find at Harvard Related

Faculty & Research

The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery

Citation:

About the Author

More from the Author