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Objective Bile acid diarrhoea affects >1% of the population. It is not known whether diagnostic 75-selenium homocholic acid taurine (SeHCAT) scanning influences treatment. This study aimed to determine recent trends in the use of SeHCAT scanning in England and whether regional prescribing patterns of the bile acid sequestrant colesevelam are associated with diagnostic testing.Design/methods An observational study over 4 years using data from the manufacturer of SeHCAT and NHS prescribing records to determine rates of SeHCAT use and prescription of colesevelam.Results Data from 2022 to 2025 were analysed. Substantial variation was observed across Integrated Care Boards (ICBs). Colesevelam prescribing rates differed fourfold to sixfold between ICBs each year. SeHCAT scan rates varied from 0 to close to 100 per 100 000 population. Over 4 years, colesevelam prescribing increased by an average of 23% annually (incidence rate ratio (IRR)=1.23, 95% CI 1.21 to 1.24, p<0.001). SeHCAT scanning increased by approximately 10% annually, although with greater inter-ICB variability (IRR=1.09, 95% CI 1.06 to 1.11, p<0.001).Higher SeHCAT activity was associated with higher colesevelam prescribing at the population level. Each additional SeHCAT scan/100 000 population was associated with approximately 1% higher prescribing (IRR=1.00, 95% CI 1.00 to 1.01, p=0.008).Conclusion There is wide variation in the use of diagnostic SeHCAT scan between ICBs in England; this is associated with very different prescription rates of colesevelam. This study demonstrates a marked postcode lottery in the diagnosis and treatment of this common condition.