January 19, 2018

Can a Website Help Consumers Navigate Price and Quality Variation in Health Care?

Measuring the Impact of Transparency research brief

Our Premise

One viable approach to reduce the soaring health care spending currently plaguing the United States is to create a marketplace wherein high value health care is rewarded by patients “voting with their feet.” In such a system, care that delivers uniformly high health outcomes and patient satisfaction for the lowest level of spending will rise to the top as lower value care is eschewed. For this marketplace to function, consumer access to complete and accurate cost and quality information is a requirement. We believe that given the appropriate transparency tools, health care consumers can and will choose higher value care, putting market pressure on health care providers to improve quality and reduce costs. 

Our Product

PROMETHEUS Analytics® transforms vast amounts of data contained in insurance claims into actionable insights for consumers, providers, and payers. In partnership with the Maryland Health Care Commission (MHCC), we developed a new PROMETHEUS report to power a consumer-friendly transparency dashboard that displays cost and quality information at facilities where a significant number of Maryland residents receive care. Because PROMETHEUS separates typical costs from costs related to potentially avoidable complications (PACs), we can calculate a measure of clinical quality called the Risk-Standardized PAC Rate (RSPR). Through the transparency site, consumers can see not just the total cost of an episode at a facility, but also how many of that facility’s patients received deficient care likely to cause harm. 

Our Evidence

Our premise is that consumers can and will choose higher value health care in certain contexts with the right information, but where is the evidence? We have begun by asking a large panel of Maryland residents about their own experiences finding value in health care and about MHCC’s public transparency website, WearTheCost.org. This work allows us to gauge baseline consumer knowledge and test a beta version of the WearTheCost.org site with survey participants. We found that like the rest of the American population, most Marylanders worry about the cost of health care but don’t currently compare prices before getting care. One reason for this is a lack of actionable, easy to access information. Participants who previewed WearTheCost.org reported that they were much more likely to compare prices for future health events than those who had not viewed the site. Further, most consumers said they would switch from an established provider to save a few hundred dollars in out-of-pocket costs. The message is clear: Consumers say they are ready and willing to shop, and tools like WearTheCost.org could help them do that.


WearTheCost.org

  • Increases health care value literacy and provides an easy-to-use tool for comparing facilities on an episode of care basis
  • Focuses for now on four relatively common medical episodes: hip replacement, knee replacement, hysterectomy, and vaginal delivery
  • Shows average cost of each episode for Marylanders and the facilities where Marylanders have highest and lowest costs for their complete episode
  • Features easy-to-read bar charts and tables with facilities ranked by cost and quality

Our Plans for Expansion

Altarum and Catalyst for Payment Reform have shown that most states are failing to provide sufficient price and quality transparency to their residents. Maryland’s WearTheCost site was made possible by earlier investment in an All Payer Claims Database (APCD) and a commitment to help health care consumers make educated choices. Altarum is ready to help states build their own consumer-friendly transparency tools that will empower consumers and facilitate healthy competition in the health care marketplace. This paper describes key findings from our study of the Maryland transparency site, WearTheCost.org. These results should prompt consumers, providers, and payers to join the growing movement to transparency. 

Acknowledgments
The survey research detailed in this brief was made possible in part by funding from the Maryland Health Care Commission. WearTheCost.org is currently live, providing health care cost and quality information for Maryland residents.

 

Project Leaders

Project Leader

Greg Matthews Portrait

Greg Matthews

Deputy Director, Center for Value in Health Care

greg.matthews@altarum.org