Do consumers use information to choose a health-care provider system?

Hospital competition when patients learn through experience

We study competing hospitals' incentives for quality provision in a dynamic setting where healthcare is an experience good. In our model, the utility a patient derives from choosing a particular provider depends on a subjective component specific to the match between the patient and the provider, which can only be learned through experience. We find that the experience-good nature of healthcare can either reinforce or dampen the demand responsiveness to quality and the hospitals' incentives for quality provision, depending on two key factors: the shape of the distribution of match-specific utilities and the cost relationship between quality provision and treatment volume. We establish conditions under which ignoring the experience dimension of healthcare leads to inaccurate assessments of the competitiveness of hospital markets.

“I think sometimes the whole process is just a little bit intimidating”: modeling the health insurance decision-making process

Purpose

This qualitative study explores how individuals understand health insurance concepts and make health insurance purchase decisions. The study sought to develop a model of the health insurance decision-making process.

Design/methodology/approach

This study used semi-structured interview questions and the micro-moment time-line interview technique with newly hired employees to discuss the steps that individuals follow when making health insurance decisions. The researcher used an open coding approach to analyze the steps listed by each participant, and emergent themes were used to code all interview transcripts in Atlas.ti.

Findings

This study identified information tactics used by individuals when evaluating health insurance documentation. The findings also shed light on the personal reflection individuals undertake when making their health insurance choices.

Practical implications

The information needs and preferred information sources identified in this study will be of interest to information professionals and human resources officers providing assistance with health insurance enrolment.

Originality/value

The findings demonstrating that participants characterized their health insurance choice as a shared decision is a novel contribution of this study.

Trusting Sources of Information on Quality of Physician Care

Reporting healthcare quality has become an important factor in healthcare delivery. Prior research has shown that patient-consumers do not frequently use information on websites reporting physician quality to guide their choice of physicians. Our aim is to understand the contextual and personal characteristics that influence patient-consumers’ decisions to trust or ignore information sources about healthcare quality. We use data from Finding Quality Doctors: How Americans Evaluate Provider Quality in the US, 2014, to examine factors that explain trust in sources reporting healthcare quality provided by physicians. Using factor analysis, 3 overarching information sources were identified: (1) employers and healthcare providers; (2) user advocacy sources; and (3) insurance companies and government. We use multiple regression analysis to understand the factors that impact trust in these 3 information sources. Our study found that contrary to previous findings, health status was not a significant factor that affects trust in sources reporting care quality data. Also, age was the only factor that significantly correlated with trusting information from all 3 sources. Specifically, younger adults trusted information from all sources compared to older adults. Furthermore, political affiliation, employment status, income, and area of residence correlated with trusting care quality information from either companies and government agencies or family and social network sources. Results suggest that individual and contextual characteristics are significant factors in trusting information sources regardless of health status and these should be taken into consideration by those promoting public reporting of healthcare quality information.

Let the buyer beware: Content analysis of cosmetic surgery websites' provider information

Given that many consumers do not understand any licensed physician can perform cosmetic surgery, cosmetic procedure advertising regulation is lacking and differs by state; and consumers often search for providers online and rely on the site's information. Cosmetic surgery websites have the potential to be a threat to consumers' safety and health. This study asked what types of physician information do cosmetic surgery websites supply. A content analysis was conducted with 873 physicians' information provided on cosmetic surgery websites in the top 10 cosmetic surgery cities, finding members of plastic surgery associations and core providers were more likely to list medical qualifications. All physicians were unlikely to list experience. Two-thirds stated their specific board certification, and 15% to 30% in each city failed to follow their state's regulations for disclosing board certification. The study concludes by suggesting national ethical guidelines.

Seek and Ye Shall Find

Significant investments have been made in developing and disseminating health care provider cost and quality information on the Internet with the expectation that stronger consumer engagement will lead consumers to seek providers who deliver high-quality, low-cost care. However, prior research shows that the awareness and use of such information is low. This study investigates how the information search process may contribute to explaining this result. The analysis reveals that the Web sites most likely to be found by consumers are owned by private companies and provide information based on anecdotal patient experiences. Web sites less likely to be found have government or community-based ownership, are based on administrative data, and contain a mixture of quality, cost, and patient experience information. Searches for information on hospitals reveal more cost and quality information based on administrative data, whereas searches that focus on clinics or physicians are more likely to produce information based on patient narratives.

Creating Compact Comparative Health Care Information

Background. The recent emphasis on providing comparative health care data to the public has resulted in a large amount of online information. To focus on the most essential attributes, insight is needed into which attributes are actually considered by consumers. Objective. To assess which attributes of Dutch hospital performance information contribute most to consumers’ hospital choice for cataract and total hip or knee replacement surgery. Design. Two discrete-choice experiments were performed: one for cataract surgery and one for total hip or knee replacement surgery. Participants viewed hypothetical hospitals based on representative values for 10 attributes (e.g., distance to the hospital, waiting time for the surgery, conduct of professionals, information provision, complication rate) and were asked to select the hospital they would choose if they needed treatment. We used multilevel logistic regression analysis to test the effects of the attributes and the interactions between attributes and respondent characteristics on consumers’ hospital choice. Results. All except one attribute (length of the first appointment with the ophthalmologist) contributed significantly to consumers’ choices. Although some differences were found between cataract and hip/knee replacement surgery, the most influential attributes for both types of surgeries were distance, waiting time, and the attributes of patient safety (complication rate of capsular rupture and the use of procedures to prevent adverse effects of thrombosis). Interaction effects were found between hospital attributes, on one hand, and age, education, and consumer choice orientation, on the other hand. Conclusions. As for cataract and total hip/knee replacement surgery, the attributes that seem most important to consumers when choosing a hospital are access (waiting time and distance) and patient safety attributes.

Where would you go for your next hospitalization?

We examine the effects of diverse dimensions of hospital quality - including consumers' perceptions of unobserved attributes - on future hospital choice. We utilize consumers' stated preference weights to obtain hospital-specific estimates of perceptions about unmeasured attributes such as reputation. We report three findings. First, consumers' perceptions of reputation and medical services contribute substantially to utility for a hospital choice. Second, consumers tend to select hospitals with high clinical quality scores even before the scores are publicized. However, the effect of clinical quality on hospital choice is relatively small. Third, satisfaction with a prior hospital admission has a large impact on future hospital choice. Our findings suggest that including measures of consumers' experience in report cards may increase their responsiveness to publicized information, but other strategies are needed to overcome the large effects of consumers' beliefs about other quality attributes.

Patient's decision making in selecting a hospital for elective orthopaedic surgery

RATIONALE, AIMS AND OBJECTIVES

The admission to a hospital for elective surgery, like arthroplasty, can be planned ahead. The elective nature of arthroplasty and the increasing stimulus of the public to critically select a hospital raise the issue of how patients actually take such decisions. The aim of this paper is to describe the decision-making process of selecting a hospital as experienced by people who underwent elective joint arthroplasty and to understand what factors influenced the decision-making process.

METHODS

Qualitative descriptive study with 18 participants who had a hip or knee replacement within the last 5 years. Data were gathered from eight individual interviews and four focus group interviews and analysed by content analysis.

RESULTS

Three categories that influenced the selection of a hospital were revealed: information sources, criteria in decision making and decision-making styles within the GP- patient relationship. Various contextual aspects influenced the decision-making process. Most participants gave higher priority to the selection of a medical specialist than to the selection of a hospital.

CONCLUSION

Selecting a hospital for arthroplasty is extremely complex. The decision-making process is a highly individualized process because patients have to consider and assimilate a diversity of aspects, which are relevant to their specific situation. Our findings support the model of shared decision making, which indicates that general practitioners should be attuned to the distinct needs of each patient at various moments during the decision making, taking into account personal, medical and contextual factors.

Consumer-oriented health care reform strategies: a review of the evidence on managed competition and consumer-directed health insurance

CONTEXT

For many years, leading health care reform proposals have been based on market-oriented strategies. In the 1990s, a number of reform proposals were built around the concept of "managed competition," but more recently, "consumer-directed health care" models have received attention. Although price-conscious consumer demand plays a critical role in both the managed competition and consumer-directed health care models, the two strategies are based on different visions of the health care marketplace and the best way to use market forces to achieve greater systemwide efficiencies.

METHODS

This article reviews the research literature that tests the main hypotheses concerning the two policy strategies.

FINDINGS

Numerous studies provide consistent evidence that consumers' health plan choices are sensitive to out-of-pocket premiums. The elasticity of demand appears to vary with consumers' health risk, with younger, healthier individuals being more price sensitive. This heterogeneity increases the potential for adverse selection. Biased risk selection also is a concern when the menu of health plan options includes consumer-directed health plans. Several studies confirm that such plans tend to attract healthier enrollees. A smaller number of studies test the main hypothesis regarding consumer-directed health plans, which is that they result in lower medical spending than do more generous plans. These studies find little support for this claim.

CONCLUSIONS

The experiences of employers that have adopted key elements of managed competition are generally consistent with the key hypotheses underlying that strategy. Research in this area, however, has focused on only a narrow range of questions. Because consumer-directed health care is such a recent phenomenon, research on this strategy is even more limited. Additional studies on both topics would be valuable.

Do report cards tell consumers anything they don't know already? The case of Medicare HMOs

Estimated responses to report cards may reflect learning about quality that would have occurred in their absence ("market-based learning"). Using panel data on Medicare HMOs, we examine the relationship between enrollment and quality before and after report cards were mailed to 40 million Medicare beneficiaries in 1999 and 2000. We find consumers learn from both public report cards and market-based sources, with the latter having a larger impact. Consumers are especially sensitive to both sources of information when the variance in HMO quality is greater. The effect of report cards is driven by beneficiaries' responses to consumer satisfaction scores.

Hospital Responses to the Leapfrog Group in Local Markets

The Leapfrog (LF) initiative, directed at improving patient safety in hospitals, may be the most ambitious, coordinated attempt to date on the part of large employers to shape the delivery of health care in America. This article assesses the role of market conditions and other factors in influencing hospital responses to LF activities at the community level. Community characteristics were found to be important in explaining hospital participation in a LF safety standards survey at the study sites. However, characteristics of the individual hospitals, and of the LF goals themselves, were more important in explaining the relatively limited progress by hospitals across all sites in achieving those goals over a 5-year period.

Composite health plan quality scales

This study employs exploratory factor analysis and scale construction methods with commercial Health Plan Employers Data Information Set (HEDISS) process of care and outcome measures from 1999 to uncover evidence for a unidimensional composite health maintenance organization (HMO) quality scale. Summated scales by categories of care are created and are then used in a factor analysis that has a single factor solution. The category of care scales were used to construct a summated composite scale which exhibits strong evidence of internal consistency (alpha= 0.90). External validity of the composite quality scale was checked by regressing the composite scale on Consumer Assessment of Healthcare Providers and Systems (CAHPS) survey results for 1999.

The effect of quality information on consumer health plan switching: evidence from the Buyers Health Care Action Group

We examine the factors that lead employees to search for health plan quality information and the effect of such information on the decision to switch plans. Extending Hirshleifer and Riley's model [Hirshleifer, J., Riley, J.G., 1979. The analytics of uncertainty and information--an expositional survey. Journal of Economic Literature 17 (December (4)), 1375-1421] of the economics of information, we develop a two-equation model of quality information awareness and switching behavior. We estimate the model using data from a random sample of 651 single employees from 16 firms that are members of the Buyers Health Care Action Group, a health care purchasing coalition in the Minneapolis-St. Paul region. Our empirical results do not support either a link between quality information and switching behavior, or between perceived health plan satisfaction and switching. We do, however, find that switching is influenced by changes in premiums and whether an individual has an existing relationship with a health care provider.

Exporting the Buyers Health Care Action Group purchasing model: lessons from other communities

When first implemented in Minneapolis and St. Paul, Minnesota, the Buyers Health Care Action Group's (BHCAG) purchasing approach received considerable attention as an employer-managed, consumer-driven health care model embodying many of the principles of managed competition. First BHCAG and, later, a for-profit management company attempted to export this model to other communities. Their efforts were met with resistance from local hospitals and, in many cases, apathy by employers who were expected to be supportive. This experience underscores several difficulties that appear to be inherent in implementing purchasing models based on competing care systems. It also, once again, suggests caution in drawing lessons from community-level experiments in purchasing health care.

Understanding employee awareness of health care quality information: how can employers benefit?

OBJECTIVE

To analyze the factors associated with employee awareness of employer-disseminated quality information on providers.

DATA SOURCES

Primary data were collected in 2002 on a stratified, random sample of 1,365 employees in 16 firms that are members of the Buyers Health Care Action Group (BHCAG) located in the Minneapolis-St. Paul region. An employer survey was also conducted to assess how employers communicated the quality information to employees.

STUDY DESIGN

In 2001, BHCAG sponsored two programs for reporting provider quality. We specify employee awareness of the quality information to depend on factors that influence the benefits and costs of search. Factors influencing the benefits include age, sex, provider satisfaction, health status, job tenure, and Twin Cities tenure. Factors influencing search costs include employee income, education, and employer communication strategies. We estimate the model using bivariate probit analysis.

DATA COLLECTION

Employee data were collected by phone survey.

PRINCIPAL FINDINGS

Overall, the level of quality information awareness is low. However, employer communication strategies such as distributing booklets to all employees or making them available on request have a large effect on the probability of quality information awareness. Employee education and utilization of providers' services are also positively related to awareness.

CONCLUSIONS

This study is one of the first to investigate employee awareness of provider quality information. Given the direct implications for medical outcomes, one might anticipate higher rates of awareness regarding provider quality, relative to plan quality. However, we do not find empirical evidence to support this assertion.

Employee choice of consumer-driven health insurance in a multiplan, multiproduct setting

OBJECTIVE

To determine who chooses a Consumer-Driven Health Plan (CDHP) in a multiplan, multiproduct setting, and, specifically, whether the CDHP attracts the sicker employees in a company's risk pool.

STUDY DESIGN

We estimated a health plan choice equation for employees of the University of Minnesota, who had a choice in 2002 of a CDHP and three other health plans--a traditional health maintenance organization (HMO), a preferred provider organization (PPO), and a tiered network product based on care systems. Data from an employee survey were matched to information from the university's payroll system.

PRINCIPAL FINDINGS

Chronic illness of the employee or family members had no effect on choice of the CDHP, but such employees tended to choose the PPO. The employee's age was not related to CDHP choice. Higher-income employees chose the CDHP, as well as those who preferred health plans with a national provider panel that includes their physician in the panel. Employees tended to choose plans with lower out-of-pocket premiums, and surprisingly, employees with a chronic health condition themselves or in their family were more price-sensitive.

CONCLUSIONS

This study provides the first evidence on who chooses a CDHP in a multiplan, multiproduct setting. The CDHP was not chosen disproportionately by the young and healthy, but it did attract the wealthy and those who found the availability of providers more appealing. Low out-of-pocket premiums are important features of health plans and in this setting, low premiums appeal to those who are less healthy.

How do patients choose physicians? Evidence from a national survey of enrollees in employment-related health plans

OBJECTIVE

This study examines the process by which patients search for and choose physicians.

DATA SOURCE

A survey to a random sample of individuals between the ages of 21 and 64 with employer-related health benefits, drawn from a nationally representative panel of households.

STUDY DESIGN

Logit models are used to measure the effect of patient characteristics on the probability of (1) using alternative sources of information to support the choice of a current physician, (2) seriously considering another physician before choosing a current physician, and (3) stating a willingness to switch physicians when information suggests that other health plan doctors receive higher quality ratings.

PRINCIPAL FINDINGS

Although a minority of respondents actively searches for a physician, there appears to be substantial variation in the degree of consumer activism across patient subgroups. Poor health status, higher levels of service use in the past year, and stronger ties to individual physicians are associated with less consumer activism. At the same time, greater levels of consumer activism were found among racial and ethnic minorities, among those who report using information to choose their physicians, and among those who switched physicians as a result of dissatisfaction some time in the past five years. Source of quality information (medical experts versus patient advocates) did not influence stated willingness to switch physicians.

CONCLUSIONS

Despite predictions of the increasing importance of consumer choice in shaping the health care delivery system, the results largely confirm the image depicted in the previous literature of patients as passive health care consumers of physician services, and highlight the importance of investments in the development of decision support tools in consumer-driven health care systems.

Factors influencing consumers' selection of a primary care physician

There is a growing body of literature regarding patient choice of health care plans, patient satisfaction, and patient evaluation of health care quality, but there is little information concerning the factors that influence the initial selection of a primary care physician (PCP). This exploratory study identifies and conceptualizes the physician selection dimensions which include: physician reputation/manner, physician record, physician search, consumer self-awareness, physician location, physician qualifications, physician demographics, office atmospherics, house calls/insurance, and valuing patient opinion. The study also develops and tests a scale for PCP selection using factor analysis which is demonstrated to be valid, and determines significant differences of variables, which include education level, gender, and age, using a summated scale. The study is of use to physicians in their targeting and communication strategies, and to researchers seeking to refine the scale.

Evolution in the Buyers Health Care Action Group purchasing initiative

In 1997 the Buyers Health Care Action Group (BHCAG), a coalition of large employers in the Twin Cities, introduced a new purchasing initiative (called Choice Plus) designed to promote competition among care systems, driven by consumer choices. Our analysis suggests that consumers are playing the role, to some degree, envisioned by BHCAG. However, several issues now have caused BHCAG to dramatically restructure its approach to Choice Plus. It hopes that through this restructuring, Choice Plus will grow in the Twin Cities market and be adopted in other communities as well. The success of this new approach is by no means certain, as it faces a number of critical tests.

Cost and quality trends in direct contracting arrangements

This paper presents the first empirical analysis of a 1997 initiative of the Buyers Health Care Action Group (BHCAG) known as Choice Plus. This initiative entailed direct contracts with provider-controlled delivery systems; annual care system bidding; public reports of consumer satisfaction and quality; uniform benefits; and risk-adjusted payment. After case-mix adjustment, hospital costs decreased, ambulatory care costs rose modestly, and pharmacy costs increased substantially. Process-oriented quality indicators were stable or improved. The BHCAG employer-to-provider direct contracting and consumer choice model appeared to perform reasonably well in containing costs, without measurable adverse effects on quality.

Measuring consumer perceptions of quality differences among competing health benefit plans

In this paper, we combine revealed preference and survey data on attribute importance to estimate parameters that represent average perceived differences in the quality and convenience of competing health benefit plans. We find that consumers do not perceive differences in provider quality across options. though they do perceive differences related to waiting time and access to specialists. In order to validate our approach, we estimate parameters representing perceived premiums and compare the estimates to actual premium differences. The results suggest that consumers correctly perceive the high-premium option to cost more than the low-premium option. These results increase our confidence in the use of stated importance data to identify and interpret parameters measuring the effect of otherwise unobservable attributes of choice alternatives.

No Toyotas in health care: why medical care has not evolved to meet patients' needs

The incentives and structure of health care in the United States produce exactly what we should expect in the quality of care for chronic disease: highly variable patterns of care and widespread failure to implement evidence-based best practices. The persistent inability of providers to improve patterns of practice is due in part to the lack of a "business case for quality." Providers cannot anticipate that quality improvements will result in higher prices, increased volume, or decreased costs. However, signs of a business case for quality are emerging, fueled by cost pressures, the increased availability of data, informed consumers, and public- and private-sector purchaser initiatives.

Do employees use report cards to assess health care provider systems?

OBJECTIVE

To investigate consumers' use of report cards that provide information on service quality and satisfaction at the provider group level.

DATA SOURCES

In 1998 we conducted a telephone survey of randomly selected employees in firms aligned with the Buyers Health Care Action Group (BHCAG) in the Minneapolis-St. Paul market.

STUDY DESIGN

Univariate probit models were used to determine report card utilization, perceived helpfulness of the report card, and ease of selecting a provider group. The characteristics used in the models included health status, age, gender, education, residency, job tenure, marital status, presence of dependent children, household income, and whether consumers changed provider groups.

DATA COLLECTION

Our sample consists of survey responses from 996 single individuals (a response rate of 91 percent) and 913 families (a response rate of 96 percent). The survey was supplemented with data obtained directly from employers aligned with BHCAG.

PRINCIPLE FINDINGS

Consumers who changed to a new provider group are more likely to use report card information and find it helpful, consumers employed in large firms are less likely to use the report card, and families who use information from their own health care experiences are less likely to find the report card helpful. In addition, individuals who changed to a new provider group are more likely to find the selection decision difficult.

CONCLUSION

The findings show that health care consumers are using satisfaction and service-quality information provided by their employers.

Who uses flexible spending accounts: effects of employee characteristics and employer strategies

BACKGROUND

Many large employers offer flexible spending accounts (FSAs) to shelter their employees' out-of-pocket medical expenses from taxes and thereby to encourage the purchase of health insurance policies with higher cost sharing. However, very little empirical research has examined the individual employee's decision to contribute to an FSA.

OBJECTIVES

To estimate equations for the probability that single employees with no dependents and employees with family health insurance coverage will contribute to FSAs, and the amounts contributed by those with FSAs.

RESEARCH DESIGN

An observational study of randomly-selected employees in 15 Minnesota firms matched with information on the strategies those firms use to promote FSAs. Measures of FSA participation were regressed on expected health care spending, employee socio-demographics, and employer strategies.

SUBJECTS

779 single employees with no dependents and 679 employees with family coverage.

RESULTS

Education beyond high school increases the probability that both types of subjects will contribute to FSAs, with marginal effects ranging from 16 to 48 percent. The FSA contribution rate for families doubles when the family's marginal federal income tax rate increases from 15 to 28 percent. Employer strategies to encourage participation are also effective in promoting FSAs.

CONCLUSIONS

FSAs are used mainly by high-income and highly-educated workers. We question whether this is an equitable use of the income tax code.

Health care reform and the new economy

The objectives and assumptions of health care reform have changed repeatedly during the past century and may now be entering a new historical phase as a result of the "new economy" rooted in information technology. In a high-growth context, proponents of reform may no longer feel obliged to bundle expanded coverage with tighter cost containment. At the same time, the new digital environment may facilitate innovations intended to inform and expand consumer choice and to improve quality. The new environment elevates "transparency" to a guiding principle. Health informatics has long been peripheral to reform and must now become more central.