Physician-Induced Demand: An Overview on Essay

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They might research treatments and decide the expensive methods prescribed by their physician are not required. Presumably if "physicians deviate significantly from these expectations, patients are likely to seek second opinions" (Edgmand, Moowaw, Olson 1996). Also, patients may not wish to submit themselves to uncomfortable testing and treatment that seem contraindicated, based upon their layperson's medical knowledge.

Because medicine is not a perfect science, other studies have suggested that differences in care can be largely attributed to differences in medical opinion rather than outright inflated demand. Still, the fact that research has indicated that "1/3 of certain common procedures are inappropriate or of equivocal value" suggests that differences in opinion alone cannot explain discrepancies (Edgmand, Moowaw, Olson 1996). A final incentive to over-prescribe is that fact that "in some instances, physicians may perform medical procedures in order to decrease the risk of a malpractice suit rather than because of the benefit that such a procedure provides a patient" (Edgmand, Moowaw, Olson 1996).
Direct-to-consumer pharmaceutical advertising, which exploded in the 1990s, as well as the practice of using pharmaceutical sales representatives to aggressively market to doctors may have further increased physician-driven demand. Physicians may prescribe certain medications when patients ask for them, specifically, to please patients as well be subliminally or overtly affected by the persuasive techniques used by seasoned salespersons.


Edgmand, Michael, Ronald Moowaw & Kent Olson. (1996). Economics and contemporary issues, 3rd ed. Dryden Press. Excerpt available February 25, 2011 at

Fallon, D. (1985). Testing for physician-induced demand with hypothetical cases. Medical Care,.....

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