User-Generated Ratings in Healthcare-Evidence from Yelp
Advisor: Kate Bundorf
Abstract: It is controversial whether user-generated physician ratings from online sources improve healthcare efficiency. Using the universe of Yelp physician ratings matched with Medicare claims, I examine what information on physician quality Yelp ratings reveal, whether they affect patients' physician choices, and how they change physician behaviors. Through text and correlational analysis, I show that although Yelp reviews primarily describe physicians’ interpersonal skills, Yelp ratings are also positively correlated with various measures of clinical quality. Instrumenting physicians’ average ratings with reviewers' “harshness” in rating other businesses, I discover that physicians’ average ratings increase their revenue and patient volume by 1-2% per star. Using a difference-in-differences strategy, I find that after their physicians are rated on Yelp, patients do not receive different amounts of opioid prescriptions or show different health outcomes, although they have slightly more lab and imaging tests which are possibly wasteful. Overall, Yelp ratings seem to help patients—they convey both physicians' interpersonal skills and clinical abilities, bring patients into higher-rated physicians, and do not induce physicians to hurt patients’ health via ordering harmful substances.