The effect of competition on the number of opioids prescribed

Abstract: The purpose of this study is to examine whether there is a change in physician's behavior because of increased competition in the primary care market. The hypothesis is that increased competition in the healthcare market increases the physician's tendency to prescribe drugs in order to attract patients. Therefore, this paper aims to examine whether the number of opioids prescribed has increased due to a Swedish reform known as the System of Choice that was implemented between 2007-2010, whose target was to increase the competition in the healthcare market. A difference-in-difference method is applied to examine the causal relationship between the reform and the number of prescriptions of opioids. This method is applicable since the counties introduced the reform at different points in time. The result is not statistically significant but the estimate is positive which corresponds to previous literature. However, the result could indicate that the System of Choice has had no effect on the number of opioids prescribed.