A Digital Soapbox? The Information Value of Online Physician Ratings

The internet has fostered widespread information transparency and a rapid rise in consumer-generated ratings. While these ratings, in the form of digital word-of-mouth, provide a potentially useful source of information to guide consumer decision making, they may be subject to bias. Notably controversial are online consumer ratings in healthcare services, where the consequences of poor information are substantial. Drawing on the quality transparency literature in healthcare and word-of-mouth, we examine the information value of online physician ratings. We utilize a novel dataset that combines offline survey ratings of physician quality with consumer-generated online ratings to investigate two potential biases: (1) selection of rated physicians; and (2) selection of opinions expressed. We find that although ratings provided online are correlated with offline population ratings, online patients are less likely to rate physicians of low perceived quality. Additionally, the opinions expressed online, when compared to the opinions of the offline population, tend to exaggerate physician ratings. The existence of these biases limits the information value of online ratings. Our findings highlight the general intrinsic biases associated with online ratings and contribute to the growing body of research on user-generated content. Results also have implications for policy related to reducing information asymmetry in healthcare services.