Abstract for: What causes disagreement among physicians? Dynamics of customers’ perception and physicians’ experiential learning

Over-utilization bias and variation in medical practices are two major contributors to suboptimal medical decisions. Common explanations for bias and variation in medical practices, including regional factors, personal traits, and financial incentives, view the problem in a static way. We do not seek to reject any of these contributing factors, but to offer an alternative and dynamic explanation. We have selected the obstetrician’s decision to perform C-section or natural deliveries as the context of the problem, as practice variation and over-utilization of C-section operations are prevalent. We expand on the experiential learning model proposed by Ghaffarzadegan (2011) by adding the dynamics of physicians’ reputation perceived by patients. Simulation results show that the accumulation of skill in delivery operations, combined with feedback availability that is conditional on the obstetrician’s decision, is enough to endogenously cause bias and variation, even when controlling for commonly known factors. The dynamics of patients’ matching their preferences with the obstetricians’ reputation interacts with the experiential learning dynamics, exacerbates the bias, and pushes the physicians to settle in their preferred delivery method. The results for hypothetical communities with two identical obstetricians show that physicians start diverging in their preferred child delivery method early in their career.