Obstetricians perform more cesarean sections when there are financial incentives to do so, according to a new study that explores links between economic incentives and medical decision-making during childbirth.
About 1 in 3 babies born today is delivered via C-section, compared to 1 in 5 babies delivered via the surgical procedure in 1996. During the same time period, the annual medical costs of childbirth in the U.S. have grown by $3 billion annually. There are significant variations in the rate of cesarean deliveries in different parts of the country — in Louisiana, for example, the C-section rate is nearly twice as high as in Alaska.
Obstetricians in many medical settings are paid more for C-sections. In a new working paper published by the National Bureau of Economic Research, health care economists Erin Johnson and M. Marit Rehavi calculated that doctors might make a few hundred dollars more for a C-section compared to a vaginal delivery, and a hospital might make a few thousand dollars more.
Johnson and Rehavi decided to explore the reasons for the increased number of surgical childbirth procedures via an unusual tack: They hypothesized that obstetricians would be less likely to be swayed by financial incentives when patients themselves had significant medical expertise and knowledge. By contrast, the researchers figured, such incentives might play a larger role in medical decision-making when patients knew very little.