Proposed Agenda for Research and Action. Informing Consumers About Health Care Quality (continued)

Task 4: Identify the Market Characteristics and Purchasing Strategies that Support Consumer Use of Quality Information

Overview

The utility of health care quality information clearly depends on the factors discussed in the previous three tasks: the degree to which consumers are aware of and prepared to use it, the ability of sponsors to communicate effectively, and the salience of the quality measures for consumers. An often-overlooked fourth factor is the environment in which sponsors are producing information for consumers.

Despite some notable idiosyncrasies, the U.S. health care industry functions much like a normal market, where the market refers to the ways in which services are bought, sold, delivered, and regulated. The structure of this market is defined by many things, including:

• The nature of competition among health care organizations and insurers.
• The number and size of purchasers.
• The presence of a dominant player of any kind.
• The mechanisms employed by regulators and purchasers to protect consumers, ensure access, monitor quality, and establish minimum standards.
• The extent to which purchasers make choices.
• The amount of choice ceded to consumers.
• The degree to which consumers may influence either providers, plans, or purchasers.
• The price sensitivity/immunity of health care consumers.

In light of the many ways in which structures can differ, one may surmise that some of these features make the environment more amenable to the use of information than do others. While there is no one "right" structure for a consumer information strategy, it would be a valuable endeavor to identify the characteristics of a market structure that would make the use of information compelling and fruitful for consumers.

In particular, it would be useful to test the presumption that a consumer choice model is fundamental to the use of quality information by consumers. We need evidence to identify the extent to which consumer-level choice is both necessary and sufficient for information to have value. Experience in the marketplace suggests that choice alone is not sufficient because other factors are also instrumental in determining whether consumers are able to use information to make good decision. For example, in a structure in which all health plans offer the same providers, information on the quality of the provider networks sponsored by each plan will be of limited value to consumers in making better choices among competing plans.

We also need to learn more about the necessity of choice—i.e., whether information on quality has value to consumers and patients in the absence of choice. Where consumers cannot make choices, what features of the market may allow such information to be useful? For instance, in an environment that provides strong consumer protections, information that educates consumers about quality would give people the knowledge they need to protect themselves, whether by seeking alternatives to their current options or by obtaining redress from outside parties when appropriate.

Finally, beyond the issues of necessity and sufficiency, there is a need to address practical questions about the nature of the choices that make information valuable. What kinds of choices (e.g., among plans or among providers) should consumers be making? How much choice is enough? And how much choice is too much?

The Current Situation

In the latter decades of the 20th century, the United States has played host to a variety of health care markets. This lack of a common environment makes it difficult to determine the functionality of consumer information. When information does not appear to be effective, could the structure of the market be responsible? That is, could the same kind of information work better in a different environment?

Even in the same geographical setting, purchasers may contract with different kinds of health care organizations; consumers may have no choices or many choices, choices at only one level of the health care system or choices at multiple levels. Moreover, the structure of the market is constantly in flux; what seems to prevail today may be barely noticeable tomorrow.

In light of the current emphasis on comparative quality information, it is critical to note that opportunities for choice are not evenly distributed among markets and population groups. This disparity is partially due to the nature of the health care industry and the ways in which it has been evolving over the past several years. The number and availability of competing plans and providers varies significantly across regions of the country. In general, rural areas have fewer choices of hospitals and doctors than do urban areas, and increasing numbers of smaller communities are witnessing the closure of their hospitals. Even in large metropolitan areas, which have a far greater supply of providers and a greater degree of choice than rural markets, the trend toward increasing consolidation of health care plans and delivery systems has eliminated effective competition except among a very few suppliers.

Perhaps more importantly, the availability of choice is typically determined not by market forces but by those who purchase or contract for care on behalf of consumers. A 1997 survey sponsored by the Robert Wood Johnson Foundation found that less than one in five private employers that offered health insurance to their employees provided a choice among plans(4). In general, the availability of health plan choices appears greater among public employers (at the State, county, and city level) than private employers, and among larger employers than smaller employers. According to a recent survey commissioned by the Kaiser Family Foundation, 92 percent of small firms and 44 percent of larger firms (those with more than 200 employees) offered only one plan in 1998(5).

This uneven approach to providing choice is echoed in the public sector. While the Balanced Budget Act of 1997 was intended to move the Medicare program toward a consumer choice model, certain changes in public policy resulted in a reduction in choice for many beneficiaries. At the State level, increasing numbers of state Medicaid agencies are starting to offer beneficiaries a choice of managed care plans, but several are seeking freedom-of-choice waivers that will allow them to offer only one managed care plan.

What We Need to Know: Priorities for Research

To create the structural environment necessary to provide consumers with meaningful opportunities to use quality information to make better decisions and choices about plans and providers, we need to learn more about the following questions:

1. What aspects of the market affect the salience of quality information? In what ways?
2. What kind of information about quality is useful to consumers in a purchaser-choice environment?
• What kinds of quality information, if any, are these consumers receiving?
• How can consumers use the information when purchasers make the choice?
3. What impact would a defined contribution strategy (where purchasers contribute a flat amount to the cost of coverage so that consumers bear the cost of choosing more expensive options) have on the salience of quality information for consumers?
• Will this strategy make cost more salient?
• Will consumers embrace the idea of seeking "value" in their health care decisions?
• How sensitive are consumers to changes in price?
4. What factors are likely to influence the impact of the consumer choice model? What role does each factor play in the effectiveness of the model? Examples of factors that might be considered include:
   • Number of choices (e.g., how many plans or providers?).
   • Variety of choices (e.g., what different types of plans or providers?).
   • "Distinctiveness" of choices (e.g., degree of difference in choice characteristics).
   • Choice at the plan level versus choice at the provider level.
   • Differences in urban versus rural markets.
   • Consumer characteristics (e.g., income, education, gender, race, etc.).
   • Payer characteristics (e.g., commercial, Medicaid, Medicare).
   • Type and mix of performance information (quality measures only, cost measures only, quality and cost measures combined, etc.).
   • Type of quality information (e.g., service quality, clinical quality, etc.)
   • Type and extent of financial incentives for consumers (e.g., cost sharing related to plan or provider cost levels).
   • The availability of intermediaries to provide information and assistance to consumers.
   • The availability of sound risk adjustment methods to insure that cost and quality performance measures are accurate and fair.
5. What evidence is there to suggest that the consumer choice strategy actually works in practice to:
• Drive improvements in health plan and provider quality and cost performance?
• Drive improvements in overall health system quality, affordability, and access?
• Empower consumers to make choices that better meet their health care needs?
• Drive enrollment in health care organizations that offer demonstrably better quality or value?
6. What are the roles that purchasers can play to both complement and support consumers in driving quality improvement and system change?
7. What percentage of consumers making informed choices is needed in a given market to drive improvements in quality and cost performance? What percentage of purchasers making informed choices is needed?
8. Who is making the consumer choice when a caregiver is involved (e.g., for a child, a senior, or someone who’s impaired)? How does the surrogate make choices?
9. Is the consumer choice model appropriate for different kinds of markets and different communities?
• Specifically, what is the impact of a competitive approach based on quality and cost performance on safety net providers and the public health infrastructure?
10. In the absence of choice, does the public reporting of comparative cost and quality information by itself have a positive impact on provider behavior and quality improvement (e.g., providing public information alone in situations where choice is not available or not offered to consumers)?
• Do people value data on the quality of health plans and providers from the perspective of increasing public accountability?

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Task 5: Evaluate the Utility and Impact of Consumer Information Efforts

Overview

How will we know if consumer information initiatives are successful? First, there must be agreement on what the project is meant to do. As noted earlier, a consumer information strategy may have any number of different but related goals. Some projects may be more oriented towards long-term system-level change, while others are focused on short-term behavioral changes at the level of individual consumers or provider organizations. At this point in the development of this field, it is particularly important that those tasked with the evaluation pay more attention to the prospects for reaching reasonable, short-term objectives than to the unlikely possibility of detecting broad changes in the marketplace.

Once the objective has been stated clearly, the next step is to conduct a scientifically valid evaluation of the project’s impact. This requires an understanding of the appropriateness and limitations of evaluation methodologies. It also means that sponsors of quality information projects must have the funds and the resources to conduct evaluations when they are most likely to result in useful information.

Finally, we must have a mechanism for sharing the lessons from evaluations and incorporating them into ongoing and future projects. To move this field forward as efficiently as possible, sponsors of quality reporting projects will need an easy way to learn from the experiences of others.

Current Situation

The evaluation phase of quality information projects tends to be overlooked and underfunded. To the extent that sponsors have taken the time to assess their progress, their results are often discouraging, but that is primarily because many sponsors have expected too much too soon. Another common scenario is that the evaluation is too unfocused or incomplete to be of much use to future iterations of the project. That is, it does not help the sponsor determine what could be done differently in order to achieve better outcomes. And because the results are not useful or even negative, the sponsor has little motivation to tackle an evaluation in the next round.

Thus, the biggest problem with evaluations today is that they simply are not happening. Few people understand how to structure the process so that it results in useful information, and no mechanism exists to train people in the skills they need to handle this key part of a consumer information project. Our ability to overcome these obstacles may determine how quickly we are able to move beyond the current spate of information initiatives to develop programs that can get closer to the goals of the consumer information movement.

What We Need to Know: Priorities for Research

In order to conduct effective evaluations that result in useful information, we need to develop a better understanding of the following issues:

1. What expectations are realistic, based on the experiences of others?
• What can sponsors reasonably expect to deliver to the market in the short to mid-term?
• What can they hope to accomplish?
2. What practical and affordable evaluation methods can be applied to help assess the overall impact of consumer information efforts in the following areas?
• Improvements in data collection and integrity.
• Consumer satisfaction with their ability to make choices.
• Consumer satisfaction with their choices.
• Consumer ability to use plans and providers effectively.
• Market share and member retention.
• Plan and provider behavior.
• Population health status.
• Improving health care system quality, cost, access.
3. What is the optimal timeframe for conducting an evaluation in order to capture the impact of a project?
4. What methodology can be used to conduct a cost/benefit analysis of consumer information efforts?
5. How can sponsors quantify the return on their investment in cases where the impact of their information projects is quantifiable (e.g., they can identify changes in enrollment that favor lower-cost, higher-quality providers or plans)?

What We Need to Do: Priorities for Action

To make evaluations both more effective and more feasible, we need to develop ways to make them easier for sponsors, possibly by creating a few models for implementing and interpreting evaluations that they could adapt to their projects. The Work Group’s "TalkingQuality" Web site is one way to offer relevant advice and resources to sponsors. We also need a mechanism for disseminating the findings from evaluations that could be useful for other sponsors so that the evaluation effort has a larger impact.

1. Develop a strategic consensus on what sponsors and researchers can accomplish in the next few years.

• Generate realistic expectations of an intervention and what can be documented.
• Consider teaming researchers with sponsors up-front to enhance the rigor of sponsor project designs that can be usefully evaluated.

2. For comparison purposes, develop and implement a national survey monitoring system for tracking trends in consumer knowledge, attitudes, and practices related to quality information.

• Build on the 1996 and 2000 KFF/AHRQ national consumer surveys to establish an ongoing system for routinely tracking these issues. Such a system could be modeled after similar public health survey programs, such as the behavioral risk factor survey sponsored by the Centers for Disease Control and Prevention.

3. Identify and promote opportunities for sponsors and researchers to share the lessons learned from their evaluations.

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Addendum A. About the Work Group on Consumer Health Information

Purpose of the Work Group

The purpose of the Work Group on Consumer Health Care Information is to provide information and assistance to support a variety of public and private sector efforts aimed at improving the communication of health care quality information to consumers.

Sponsorship and Background

Initial funding for the Work Group was provided by the Health Care Financing Administration (HCFA). Administrative coordination for the Work Group is provided by the Agency for Healthcare Research and Quality (AHRQ, formerly Agency for Health Care Policy and Research) with support from the Office of Personnel Management (OPM). Funding has been committed by HCFA for two years (Fiscal Years 1999 and 2000), with possible additional support to be provided by AHRQ and OPM.

The Work Group convened as a result of a national invitational conference in December 1998 sponsored by HCFA with support from AHRQ and OPM entitled "Making Quality Count: Helping Consumers Make Better Health Care Choices." Conference summaries are available through the Work Group at 1-800-508-7453.

Work Group Members

The Work Group is an interdisciplinary group of researchers, purchasers, consumer advocates, and government officials. Staff support for the Work Group is provided by Westat and the Quality Measurement Advisory Service (QMAS). (Select Addendum B for a list of Work Group members.)

Charge of the Work Group

The charge of the Work Group is to oversee the following tasks:

1. Develop and Launch a Work Group Web Site: Provide a convenient and effective tool to assist various audiences in identifying and gaining access to multiple, current resources that can help them plan and implement consumer-oriented health care quality information projects and related activities. The site will provide links to many existing resources, include multiple examples of "practice innovations," and provide directories and links to organizations that can be of further assistance. It will not recommend any single "best" practice but point to multiple successful innovations that can be illustrative of effective methods of communicating health care quality information to consumers.
   
   
2. Develop a Research and Action Agenda: Identify and prioritize topics in need of further research and development, as well as specific actions and initiatives outside of research that should be undertaken to advance consumer health care quality information efforts. A second national conference will be held to provide a forum for a focused discussion involving key opinion leaders in the field about the recommendations presented in the Work Group "Research and Action Agenda."

A byproduct of these tasks is for the Work Group to serve as a vehicle for exchanging and disseminating timely information and updates among consumer health care information research and applications leaders. Examples of additional information that will be exchanged are:

• Inventory and regular updates on implementation projects.
• Contact lists and profiles of individuals and organizations engaged in implementation and research.
• New consumer information research and evaluation findings.

The Work Group will recommend and oversee specific steps for functioning as an exchange vehicle in the short term (e.g., internal Work Group web site, list servers, information Help Line, a second national conference, etc.) as well as a long-term strategy for formalizing this function on an ongoing basis.

Work Group Timeline

Date: January to March 1999.
Item: Work Group planning.

Date: April 1999.
Item: Work Group Kick-off.

Date: May to August 1999.
Item: Initiate Work Group "Talking Quality" Web Site and Research and Action Agenda.

Date: September 1999.
Item: 2nd Work Group Meeting.

Date: October 1999.
Item: Launch Internal Work Group Web Site

Date: October 1999 to May 2000.
Item: Complete Work Group "Talking Quality" Web site and Research and Action Agenda.

Date: April 2000.
Item: 3rd Work Group Meeting.

Date: Summer 2000.
Item: Launch Web site.

Date: June to September 2000.
Item:

• Maintain and update web sites & Help Line assistance.
• Refine and package Research and Action Agenda.

Date: May to November 2000.
Item: Plan 2nd National Conference.

Date: December 11-12, 2000.
Item: "Informing Consumers About Health Care Quality: New Directions for Research and Action" Conference in Bethesda, Maryland.

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