How Are Consumer Perceptions Around Healthcare Cost and Quality Shifting? One Study Probes | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

How Are Consumer Perceptions Around Healthcare Cost and Quality Shifting? One Study Probes

April 6, 2016
by Mark Hagland
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A new study finds consumers rather confused about the connecting between prices and quality in healthcare

What challenges are inherent in the attempted shift towards transparency around value in U.S. healthcare? As it turns out, there are many. For one thing, healthcare consumers in the U.S. are by and large confused about the relationship between price and quality in healthcare services. In an article published in the April issue of Health Affairs and authored by Kathryn A. Phillips, Ph.D., David Schleifer, Ph.D., and Carolin Hagelskamp, the issues are laid out in stark relief.

In their abstract to the article, titled “Most Americans Do Not Believe That There Is An Association Between Health Care Prices And Quality of Care,” the authors note that “Many organizations are developing health care price information tools for consumers. However, consumers may avoid low-price care if they perceive price to be associated with quality. We conducted a nationally representative survey to examine whether consumers perceive that price and quality are associated and whether the way in which questions are framed affects consumers’ responses.”

The abstract goes on to note that “Most Americans (58-71 percent, depending on question framing) did not think that price and quality are associated, but a substantial minority did perceive an association (21-24 percent), or were unsure whether there was one (8-16 percent). Reponses to questions framed in terms of high price and high quality differed from responses to questions framed in terms of low price and low quality. People who had compared prices were more likely than those who had not compared prices to perceive that price and quality were associated. We explore implications of these findings,” the authors write, “including how behavioral economics can inform approaches to helping consumers use price and quality information.”

The authors explain in their article that the survey on which their analysis was based “included two pairs of questions about the association between price and quality. One pair of questions referred to medical care in general, and the other referred to doctors, whose prices and quality can vary. One question in each pair asked about high price and high quality, and the other asked about low price and low quality. Survey respondents were asked one question from each pair.”

Making use of sophisticated analytical processes, the authors came up with findings regarding the significant of survey responses. While it is true that most consumers surveyed did not see an association between price and quality, the framing of questions around this subject had a significant impact. Indeed, they write, “The framing of questions (in terms of either high price/high quality or low price/low quality) significantly shifted the distribution of responses across both pairs of questions, which supported our second hypothesis,” the authors write. “Respondents who were asked about high price and high quality were consistently more likely to say that price and quality were not related, compared to respondents who were asked about low price and low quality.” (More detailed information on the study can be found here.)

At a time when more and more data and information are being provided to U.S. healthcare consumers to help them make choices about their healthcare, and also when employers are increasingly pushing their employees into high-deductible health plans, the implications of all this are significant.

How will the leaders of patient care organizations, and in particular healthcare IT leaders, move forward in terms of the preparation of data for healthcare consumer use? HCI Editor-in-Chief Mark Hagland spoke with co-author David Schleifer, Ph.D., about the broader implications of all this. Schleifer is a senior associate at the New York-based Public Agenda, which prepared the study. Public Agenda, as described on its website, is “a nonprofit, nonpartisan organization that helps diverse leaders and citizens navigate divisive, complex issues and work together to find solutions. Through nonpartisan research and public engagement, we provide the insights, tools and support people need to build common ground and arrive at solutions that work for them. In doing so, we are proving that it is possible to make progress on critical issues regardless of our differences.” The organization conducts research in numerous fields, including healthcare, education, energy issues and climate change, and around the federal budget deficit and the national debt. Below are excerpts from the interview with Dr. Schleifer.

There are some potentially very broad implications of your study. Tell me a bit about those?

Our focus was only on healthcare pricing, and not on plan choice. So there’s more crossover, though, there, than we think. So this article we have coming out… The focus is on people’s perceptions of the relationship between price and quality. But it was part of a larger study. So this is an analysis of a few survey questions from a larger study on how people seek and use price information. So, some of what I’m going to say is specifically related to the findings in this study. But some is related to findings in the larger report based on this survey.


David Schleifer, Ph.D.

How would you characterize the understanding of the average American healthcare consumer in terms of thinking about price and quality?

I would hope this speaks to the concerns of your readers, which is that people really want healthcare price information. We saw that in our survey that people have already tried to find price information. There is a strong interest in getting this information. In terms of the perceptions of the relationship between price and quality should in a way be comforting to your readers, because the findings imply that someone putting price information out there shouldn’t worry that most people are going to misinterpret that and think that high-priced care is necessarily better quality.

So in that sense, the findings should be comforting, because they suggest not only that people want this information, but also that they’re prepared to use it to seek out low-priced care. And in running focus groups in preparation for the survey, and also, in focus groups we’re running now for additional research, is this: people don’t think that healthcare prices are rational. They see a hospital build a fancy new building, and know that the hospital costs more than the hospital on the other side of town, and they know they went to the doctor last year, and now it costs more. So they’re confused in how prices are set. There’s this feeling that prices are random, and that they are punitive, and not rational.

So I think that that’s where we saw a lot of confusion. Having said that, and this is in the report, not the article, but most Americans are unsure of whether or not prices vary. And that really represents an opportunity to help people understand different providers charge different prices for the same service.

What will the impact of employers pushing consumers into high-deductible health plans, have on this?

When we looked at who was seeking price information, there were a number of demographics that were relevant. But a deductible of $500 or more seemed to be the threshold beyond which many more people were trying to find price information. So 48 percent of Americans with no deductible had tried to find price information; but once we hit $500, that changed. For those with deductibles of less than $500, it was still only 53 percent, but it went up 67 percent for people with $500-$1,000. Overall, 56 percent of Americans had tried to find price information. But 67 percent with $500-$1,000 had. Over $1,000, it was also 67 percent. But for people with deductibles of over $3,000, 74 percent reported that they had tried to find price information.

So tell me a bit more about your framing of price and quality for consumers in the survey on which the study was based?

We asked this in four different ways, but when we asked people whether high price was associated with high quality, they were more likely to say no, they’re not. When we asked them whether low price was associated with low quality, still, most people said no, but more people were responding that they weren’t sure. You saw more people saying they were unsure whether low price was associated with low quality. What I think is going on, and this is my speculation, is that people are skeptical that you really get anything better if you pay more. But they’re a little bit concerned about whether you get something worse if you pay less. We don’t really know what people think quality means. But my gut sense on this is that people think there’s sort of a quality floor, and that it can’t really get that much better. I mean, how much better can Dr. X’s colonoscopy be, than Dr. Y’s? I don’t think they think they’ll get a lot more, but we saw a lot of uncertainty about whether something really cheap is going to be maybe a little worse.

I think that this is subtle and kind of hard to grab onto, but it sort of speaks to a bigger question, one that we hope to get to a better understanding of in this new project we’re working on, which I, how much do people think quality varies at all, and what it means. To me, that’s still an open question, but I don’t think people think they get anything that that’s much better, for price. How good asparagus be, right?

Consumers are facing a tsunami of new data on cost and quality. Will the infusion of a great deal more data end up confusing them even more, or might it change how they interact with the new data?

I’m not sure that it will necessarily confuse them more, but I think that consumers will tune it out more until they need it. You have your primary care provider, and right now, they’re going to be focusing on their routine interactions in healthcare. And we do research in higher education and other fields outside healthcare, and what we see consistently is that just adding more information sort of stirring, does not necessarily make people more engaged and make different choices. It’s just not as simple as dumping more information on more people and assuming that they will pay attention to it, understand it correctly, and make different decisions based on it. There are consumers who might respond that way, but in the aggregate, I don’t think consumers respond that way. Most people aren’t thinking about their healthcare all day long.

So just putting information out there is not enough. There has to be some deeper thinking about how to engage people in it, how to help people understand it, and how to present information to the people who need it. Let’s not think that if we dump all this quality or price information out there, that it will necessarily have people come flocking to it. And I think this is where it’s important to think about different demographic segments, people’s previous experiences in healthcare, and I just think it’s got to be more complicated than, if we put it out there, people will magically use this information.

And if you think about how physicians respond to information about themselves, there are ways that people respond and ways in which people are frustrated or mystified. I would never say it’s a bad idea to give people more information, but it has to be done with more foresight and care, and paying attention to how information is perceived and used.

Based on all of this, what might your advice be for the healthcare IT leaders who will be involved in helping their patient care organizations to publicly report and present data on price and quality?

I would say things, and perhaps they’ll sound contradictory at first, but they really aren’t. One is, don’t be afraid to give information about price, because people do want it. But at the same time, it’s worth investing in research to really listen to consumers, and listen to them and understand what they want and how they want to use information. Because if there’s a certain impact that CIOs have in mind, then it’s important to kind of design the information and the way it’s distributed, in ways that are going to meet that goal.

So they have to be strategic then, correct?

They have to be strategic, and they have to be listening to consumers in a very careful way. It’s not just a question of whether consumers want or use information, but of how people make sense of the information presented to them. And I think that’s really a qualitative question. I think people really do have a capacity to learn and change, but it really would behoove people to pay attention: when we give someone a quality score, what do patients think a quality score means? And before you even get to the question of stars or bars or numbers or whatever it is, it’s really important to sit with people and help them make sense of the information being presented to them. And the other thing is, when we asked people where they were getting price information, one of the most popular sources of price information was receptionists in doctors’ offices. And that could elicit an eye roll. But if that’s one of people’s most salient and obvious sources of information, then maybe that requires thinking about who are the staff members interacting with consumers, and how they might be guides to consumers in that.

And we have a new project we’re beginning to work on. With the data the Health Affairs article is from, we now have funding from Robert Wood Johnson to field that survey again this summer, nationally; and we’re also going to be doing over-samples in four states. One will be New York state, because the New York State Health Foundation will be funding that. So that will be a re-fielding of the survey you saw. It will mostly be a similar set of questions, with small modifications. The other thing we’ll be doing is research on people’s perceptions of quality and value. So the survey will be in the field this summer, with results sometime in 2017. And we’ll be focusing specifically on people newly diagnosed with type 2 diabetes, women who have recently given birth, and people who have recently had joint replacement. So we’ll focus on them and include some of the price information and quality variation questions in that as well.

 


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