CHE Seminar Series: Squeezing the balloon - Unintended spending spillovers from provider peer comparisons
This paper examines the systemic spillover effects of behavioural cost-containment interventions using a randomized controlled trial of primary care physicians in Switzerland. The intervention deployed a peer-comparison feedback nudge targeting a prevalent low-value service: routine laboratory testing for vitamin D deficiency. While the nudge effectively reduced targeted testing by over 21%, physicians countered this localized income shock by expanding alternative, unmonitored services. Consequently, net total expenditures rose by CHF 23 per patient. This volume substitution, or clinical balloon effect, was structurally mediated by baseline clinic revenue, demonstrating that narrow behavioural nudges fail to eliminate medical waste under fee-for-service frameworks.
Speaker profile
Daniel Advic is a Professor at the Centre for Health Economics Research and Evaluation (CHERE) at UTS and an internationally acclaimed leader in the fields of health economics, applied econometrics, and policy analysis. He holds a PhD from Uppsala University and has previously held roles at the Department of Economics, Deakin University, and at the Centre for Health Economics, Monash University. Daniel's research interests comprise empirical analysis of topics relating to the production, financing and organisation of health care. He has more than 15 years’ experience of analysing administrative and clinical data from Sweden, Germany, and Australia.
Weekly seminar series
As part of our Centre's vibrant research culture, we host a weekly seminar series. Visiting and invited researchers present current research relating to the economics of health and wellbeing, and the healthcare sector. Visitors are welcome to join these sessions where discussion and debate is encouraged.
For further information on our seminar series, please contact Trong-Anh.Trinh@monash.edu.
Event Details
- Date:
- 12 August 2026 at 12:00 pm – 1:00 pm
- Venue:
- Caulfield campus, Building H, level 9, room H9.21
- Categories:
- CHE Seminar; General
Description
This paper examines the systemic spillover effects of behavioural cost-containment interventions using a randomized controlled trial of primary care physicians in Switzerland. The intervention deployed a peer-comparison feedback nudge targeting a prevalent low-value service: routine laboratory testing for vitamin D deficiency. While the nudge effectively reduced targeted testing by over 21%, physicians countered this localized income shock by expanding alternative, unmonitored services. Consequently, net total expenditures rose by CHF 23 per patient. This volume substitution, or clinical balloon effect, was structurally mediated by baseline clinic revenue, demonstrating that narrow behavioural nudges fail to eliminate medical waste under fee-for-service frameworks.
Speaker profile
Daniel Advic is a Professor at the Centre for Health Economics Research and Evaluation (CHERE) at UTS and an internationally acclaimed leader in the fields of health economics, applied econometrics, and policy analysis. He holds a PhD from Uppsala University and has previously held roles at the Department of Economics, Deakin University, and at the Centre for Health Economics, Monash University. Daniel's research interests comprise empirical analysis of topics relating to the production, financing and organisation of health care. He has more than 15 years’ experience of analysing administrative and clinical data from Sweden, Germany, and Australia.
Weekly seminar series
As part of our Centre's vibrant research culture, we host a weekly seminar series. Visiting and invited researchers present current research relating to the economics of health and wellbeing, and the healthcare sector. Visitors are welcome to join these sessions where discussion and debate is encouraged.
For further information on our seminar series, please contact Trong-Anh.Trinh@monash.edu.