The Value of (Sub) Specialization: Evidence from Oncology

Abstract

Specialization enhances professional productivity, but its benefits depend on access to the relevant expertise. In oncology, subspecialization—the narrowing of clinical focus within cancer care—has become increasingly common, yet its effects on patient outcomes remain poorly understood. This paper examines the impact of physician subspecialization in medical oncology on patient outcomes, health care spending, and access to innovation. Using detailed US Medicare data on 2.2 million first-time chemotherapy episodes from 2008 to 2020, we exploit quasi-exogenous variation in access to subspecialized oncologists through a differential distance instrument. We find that access to a subspecialist reduces three-year mortality by up to 10% relative to the mean, without increasing total Medicare spending. Subspecialist care also increases the use of newer chemotherapy agents and more than doubles enrollment in clinical cancer trials—particularly for trials aligned with the patient’s cancer type. Falsification and selection analyses support the identifying assumptions and suggest that observed gains reflect differences in treatment pathways rather than patient selection. These findings provide new evidence on the productivity effects of specialization in a non-routine, knowledge-intensive profession, and underscore the organizational trade-offs involved in delivering complex care.