Tuesday, June 23, 2009

Quality and Cost: Do you get what you pay for?

As we buy many products and services, we expect to get better quality if we are asked to pay a higher price. The new sports car is obviously more expensive and better quality than the used clunker. Of course we probably check consumer reports and other ratings before we buy just to be sure. We know high price doesn't guarantee that something is high quality. In other situations we may pay more just for the brand.

What about healthcare? Does paying more mean you are going to get higher quality?

Health Affairs published a nice study examining this issue. They looked at quality indicators and costs at specific hospitals. The bottom line: they found that many quality indicators did not improve with increasing costs and for others the quality went down at the more expensive hospitals. There were not any examples of higher quality resulting from higher costs. They also did analysis on the "Brand" issue in healthcare by looking specifically at academic medical centers. Increased costs at those centers did not add to quality either.

While the issues are complex and this study only examined a small set of clinical situations; consumers should realize that finding quality care requires careful research. And consumers should not assume that expensive providers or brand name providers have good quality. According to this study, and others, the opposite may be closer to the truth.

For useful links to quality ratings of providers, consumers can check out the Resources for Patients section at the Healthcare Blue Book.

The Health Affairs article at: Health Affairs 28, no. 4 (2009): w566–w572 (published online 21 May 2009)

Wednesday, June 10, 2009

ACE Pilot for Consumerism and Value Based Purchasing

A new demonstration project from CMS will provide patients with financial incentives to qualifying Medicare patients who select a health care provider based on quality and price.

As part of the Acute Care Episode (ACE) demonstration, five regional health systems nationwide have been designated Value-Based Care Centers. These centers will provide select cardiac and orthopedic services to Medicare beneficiaries at discounted rates.

CMS will share a portion of their savings with patients.

You can see an article on this at the Oklahoman paper.

This is a very interesting pilot.

It should give encouragement to other privately insured organizations that are exploring similar incentives.