We investigate the impact of patient-obtained medical information (POMI) on the physician-patient relationship when patients, as a group, are heterogeneously informed and a physician's interests do not coincide with those of her patients. Introducing additional well-informed patients to the population discontinuously affects the physician's strategy, having no effect unless a sufficient quantity is added. When few patients are well informed, increasing the precision of their information level has no effect on the physician's strategy. Alternately, when a sufficient number of well-informed patients exists, increasing the precision of their information allows all patients to free-ride by receiving more appropriate treatment recommendations.Counterintuitively, we also identify circumstances under which increasing the general level of information may potentially harm patients.
Copyright 2006 John Wiley & Sons, Ltd.