Distance effects and home bias in patient choice on the Internet: Evidence from an online healthcare platform in China

Telemedicine and telehealth hold promise for reducing access barriers caused by travel distance. However, little is known about how the Internet affects patients' online provider choices and thus the spatial distribution of healthcare utilization. This study investigates the effect of distance on flows of online medical consultations using a unique dataset from one of the leading third-party online healthcare platforms in China: Haodf.com. We show that the geographic distance between doctors and patients is negatively associated with online service utilization, though this effect is almost 40% ~ 50% weaker for online medical services than it is for offline medical services. We also find a strong “home bias” in which patients and doctors tend to locate in the same prefecture and in the same province. Further analyses suggest that prior in-person visits before online consultations, the potential need for a follow-up physical visit after an online consultation, and information friction may contribute to the distance effect. These findings have policy implications for improving healthcare access in China and other nations.