Information Disclosure via Platform Endorsement in Online Healthcare

Abstract

Online healthcare platforms enhance healthcare access and equity by removing geographic barriers and facilitating doctors to serve underprivileged patients. However, they exacerbate information asymmetry due to the vast number of doctors available online. To mitigate this and to motivate leading doctors to improve their practices, platforms have introduced endorsements, awarding select doctors badges for exceptional performance. This study investigates the impact of platform endorsement on both patients' demand and doctors' decisions on pricing, quantity, the mix between free and paid services, and quality by exploiting a leading Chinese platform's "Good Doctor of the Year'' endorsement program. Using the Generalized Synthetic Control method, we find that endorsement boosts demand for endorsed doctors, who respond by increasing prices and provision of paid services while maintaining service quality. However, we find that endorsement leads to an unintended consequence of a decrease in free services provided by endorsed doctors, thereby disadvantaging underprivileged patients. Notably, this reduction in free services is more pronounced among ``pro-social" doctors due to their reluctance to raise prices and limited capacity. These findings highlight the need for platforms and policymakers to understand the nuanced impacts of information disclosure on doctors' decisions and the potential unequal effects across different groups of patients in online healthcare, a sector with significant societal implications.

Note:

Funding Information: Financial support from the National Natural Science Foundation of China [grant number 72103005] and the Taikang Yicai Public Health and Epidemic Fund [grant number 2021015].

Conflict of Interests: We declare that there are no conflicts of interest regarding this manuscript.

Keywords: online healthcare, platform endorsement, doctor consultations, paid services, free services

JEL Classification: D40, I11, I14, L15, M31