Treating Surgeons: Evidence from a Field Experiment on Cost Containment

Abstract: Information asymmetries between managers and workers are especially pronounced when workers possess professional expertise. In health care, excessive costs are common, yet directly incentivizing cost-control can produce unintended consequences. We evaluate whether a low-cost, scalable intervention can reduce surgical costs without compromising patient care. In a field experiment, surgeons and nurses randomly receive customized information on typical equipment usage for procedures they perform. The intervention reduces expenditure on targeted disposable equipment by 9–10%, with no adverse effect on clinical outcomes. The effects are driven by surgeons, with evidence suggesting the intervention operated by making choices regarding equipment use salient.