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Guest commentary

Hospital cost information not enough

Cutline: Donald S. Likosky

Donald S. Likosky

With the implementation of the Affordable Care Act, consumers are being challenged to make decisions about their health care, including which hospital or provider network to choose. Yet, it’s difficult to find readily available and easy-to-understand information about hospital quality.

The U.S. Centers for Medicare & Medicaid Services (CMS) has begun to publish hospital-level cost data. But, to more fully meet the needs of consumers, hospital-level quality data should be similarly reported.

For example, when CMS published data in May, 2013 reflecting the charges by and payments to 3,000 U.S. hospitals during fiscal year 2011, it found remarkable variability in hospital charges, including 13-fold variability for heart surgery procedures. While these data help the public be more aware of the wide differences in hospital charges, they do not provide sufficient insight into whether these hospitals followed evidence-based practices, or whether the patients served had favorable clinical outcomes.

It’s a good start, but not enough.

Meaningful transparency in health care should include both financial data and disease and condition-specific quality measures to help consumers make more informed health-care decisions. Together, financial and quality data more accurately reflect whether hospitals are providing value to patients, payers and society.

As a policy fellow with the University of Michigan Center for Healthcare Research & Transformation and a cardiovascular researcher, I recognize the complexity of measuring health-care quality. Physician and other health care provider organizations have begun partnering with organizations, such as the National Quality Forum, to develop and standardize quality measures. With these complementary sets of data, we are better able to assess the value that hospitals provide to their patients.

For example, CMS currently provides the public with information about a hospital’s care of heart surgery patients on its dedicated website. One measure reflects the percentage of patients whose blood glucose is well-controlled after surgery, since poor glucose control may increase a patient’s risk of death. This information gives consumers more insight into a hospital’s quality practices. While important and meaningful, more robust measures of quality are available to assess the quality of care for heart surgery patients.

In Michigan, hospitals across the state are working with Blue Cross Blue Shield of Michigan on the Michigan Value Collaborative, an effort to track both quality and costs for a select group of conditions. As part of the collaboration, participating hospitals will see how their costs and quality measures compare with other hospitals in treating the same conditions. This unprecedented collaboration will certainly provide insight into how hospitals across the state may learn from one another to improve the value of services for their patients.

CMS should make similarly robust information concerning hospital quality available to the public. By releasing financial data, CMS has taken a solid step towards improving our understanding of the costs of providing healthcare for major diseases and conditions at US hospitals. Including a well-rounded set of hospital clinical quality measures would provide evidence that patients treated at these hospitals receive evidence-based care. Combined, these data would aid patients in making more informed health care decisions.

Donald S. Likosky, Ph.D. is an Associate Professor and head of the Section of Health Services Research and Quality in the Department of Cardiac Surgery, University of Michigan Medical School, Ann Arbor

Bridge welcomes guest columns from a diverse range of people on issues relating to Michigan and its future. The views and assertions of these writers do not necessarily reflect those of Bridge or The Center for Michigan.

4 comments from Bridge readers.Add mine!

  1. Scott Lyon

    As Warren Buffet likes to say, “Price is what you pay. Value is what you get”. Until we have both cost and quality information, the ability to pick a high value hospital, surgeon, etc. will be extremely difficult. Increasing deductible and co-payment amounts should put more pressure on the “system” to produce meaningful information that health care consumers can use to make informed choices.

  2. Steve Sawyer

    It’s in the best interest of the health care industry to keep everything as opaque as possible. If you don’t know what you’re paying and you don’t know what you’re getting, you cannot make the choices that everyone outside the industry says we need to make, and the industry can maximize their revenues, and profits for those operating in the private sector. In addition, to compile the requisite data on costs and outcomes incurs an additional cost on providers, providing a further dis-incentive to be forthcoming with this information.

    Finally, data by itself is meaningless without careful and unbiased interpretation of that data. We all know how effectively data can be distorted, hidden, limited, selectively exposed or simply not aggregated in a meaningful way so that this information can deliberately confuse or mislead. Thus what is required is not just data transparency on the part of health care providers, but it needs to be communicated to the public.

    There is no entity that either has the will, a tangible incentive, or the political support to make this happen.

    Therefore, it ain’t gonna happen – forget about it.

  3. John Strate

    Perhaps the Joint Commission should make public whatever it gathers and analyzes when hospital go through accreditation. Will it happen? Not!

  4. Doug Drake

    The biggest problem in health care cost containment is that most “consumers” and especially those in emergency situations, have neither the time nor the opportunity to evaluate alternatives. I was freshly reminded of this with my recent sudden cardiac arrest and implantation of an ICD. Shopping was not an alternative, and the sticker prices, at least were astonishing.

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