Transparency in Healthcare

Seeing is Believing

Sandy Lutz, Director, PricewaterhouseCoopers Health Research Institute, USA.

The growing demand for transparency in healthcare is lifting the veil on this notoriously murky industry, but achieving transparency is a problematic journey that requires unprecedented collaboration across sectors within the health industries and adherence to world-class standards.

Government and healthcare leaders around the world recognise that transparency is critical to the sustainability of health systems in the future. The presumption is that when consumers are armed with accurate information and informed choices, providers will improve the quality of care they deliver, government and other reimbursers can reward quality and efficiency and consumers will assume a greater role in the management of their own health.

The combination of these forces would produce higher quality care at less cost—an imperative for the future as health systems falter under of weight of an ageing, obese and more prosperous population with more chronic diseases.

As part of global research into the sustainability of health systems, PricewaterhouseCoopers talked to more than 700 health leaders in 27 countries around the world, including government leaders and policy makers, executives from hospitals and health networks, private insurers and other business leaders outside the health industries. More than half told us that they consider transparency of quality and pricing information to be “very important” to the sustainability of national health systems. The notion that “seeing is believing” is the new mantra of consumer-driven healthcare. Without transparency in a consumer-driven healthcare market, confidence in the medical profession will erode, and market participants will remain vulnerable to competition, corruption and potential collapse.

It is no secret that healthcare has lagged other industries in becoming transparent or that much of Asia is playing to catch up on this front. Yet throughout Asia, there are mounting public aspirations that the time has arrived for people to have full access to the benefits of the modern world, particularly when it comes to healthcare and medicine. Consumerism now dominates the minds of the new Asian middle class, even as it meets resistance from old world traditions that have slowed the progress of healthcare reform in many parts of the region.

Achieving transparency is a problematic journey, one that requires cross-sector collaboration that is unprecedented in even the most advanced health systems. But best practices are beginning to emerge. As transparency starts to define business relationships in health, it is important to understand the expectations of all stakeholders and to anticipate unintended consequences.

Stakeholders often disagree on the details of how data is collected and disseminated. Infusing a flood of information on the public can cause disruption and misunderstanding. Lack of agreement about the definition of quality or cooperation on standards can result in a ballooning number of diverse and potentially unfair quality measures. Then there is concern about the privacy and accuracy of information about patients or participants in clinical trial activities. What’s clear is that transparency is viewed as both a negative and a positive. Skeptics contend that the health market is unique, and cannot be treated like other markets. The time and energy required to publish the usable and credible cost and quality of every medical procedure is simply too difficult and not practical.

In theory, proponents of transparency outweigh the skeptics. But, in practice, transparency creates enormous challenges. So, we asked a group of health leadership across health industries how they thought a transparency health community would affect their sectors and what they thought they would need to achieve transparency.

To create transparency, we believe that the framework must have the following features:

• Information about cost and quality that is trusted by stakeholders
• Incentives for patients, providers and government or other reimbursers that improve the efficiency and effectiveness of care
• Connectivity to disseminate information through interoperable health information systems

Exhibit: The Needs and Challenges of Stakeholders in a Transparent Community.
Table 1

Information about Cost and Quality that is Trusted by Stakeholders

Health systems that have made progress in making health quality data transparent, have been first to learn that publishing this data poses additional challenges around embedding quality standards into health services, treatments and processes. Each country’s unique combination of cultural, political, economic and historic factors shapes its definition of quality. In fact, the Commonwealth Fund International Working Group on Quality Indicators found more than 1,000 potential indicators that could be measured across different health systems.

Transparency of quality and pricing hinges on the availability of accurate, reliable and valid performance measures. Data is not always what it seems. It needs to be validated if it is to be useful, and much work still needs to be done in this area. The absence of global health standards is driving many health systems to adopt best practices in quality improvement used by other industries and other countries.

Incentives for Providers

Real improvements in the quality of healthcare will occur only after incentives are properly aligned around creating value and performance can be rewarded appropriately. Because patients have been insulated from the cost of healthcare for generations, a key challenge goes beyond transparency of price and quality information. Patients not only need to understand how the cost of healthcare is directly connected to their own behaviour, but also how changing their behaviour helps drive down that cost. For example, consumer-directed health plans in some markets are designed to increase cost-sharing that will make consumers more sensitive to the consumption of medical products and services. However, early evidence has shown that some patients have delayed or avoided getting care due to high price, which may result in even higher costs.

In designing the incentives that are crucial to a transparent community, stakeholders should consider developing a therapeutic index for cost-sharing around certain diseases or treatments. The clinical term, therapeutic index (also known as the margin of safety), is a comparison of the amount of a drug that causes the therapeutic effect (good) to the amount that causes a toxic effect (bad). Consumer healthcare incentives have typically shown a very narrow therapeutic index, in other words, the “good” incentive (or therapeutic effect) does not outweigh the “bad” incentive (or toxic effect) to effectively incentivise the consumer to perform a desired behaviour.

A portion of the complexity and disagreement stems from how transparency is discussed and defined. Many of the government-sponsored transparency initiatives are defined in a pair wise fashion. The problem with this approach is that what any two sectors might agree on regarding transparency either aggravates or threatens another sector. For example, reimbursers and consumers may agree on certain quality metrics from physicians and hospitals. Yet, the hospitals may disagree about how “quality” is defined.

Or, perhaps providers and employers agree that medical information should be openly shared with each other to aid in patient compliance initiatives, but patients may feel this violates their privacy. To move beyond these collisions of interests, incentives need to be aligned and definitions standardised across stakeholder groups. To begin to make progress, the following question needs to be answered: “What is the minimum bundle of transparency initiatives that can come together and make the pain equal so that the various sectors don’t feel like they are the target?”

Connectivity to Disseminate Information through Interoperable Health Information Systems

Quality improvements will ultimately rely on more widespread investments in electronic medical records, more effective policies governing national standards for health quality, and greater cross-border standards and information sharing such as development of a global “network of health networks”.

Asia’s healthcare organisations, particularly those dealing with both first and third World issues, are urgently seeking solutions to temper costs while balancing the need to provide access to safe, quality care. Across boundaries, languages and cultures, successful initiatives—often involving technological innovation—are occurring, but the best practices are only beginning to be shared across geographic and industry boundaries.

The vision of electronically connected health promises to revolutionise the way healthcare is delivered. Better use of technology and interoperable electronic networks will:

• Improve access, equity, quality and accountability of care
• Empower patients through enhanced interaction with providers
• Erase geographical and physical barriers to care
• Accelerate integration, standardisation and knowledge transfer of administrative and clinical information
• Radically transform the way health professionals learn, train, teach and practice

The use of personal health records is being implemented throughout Asia and efforts are being made to consolidate patient information on a common IT platform. Right now, multiple medical records are stored in different clinics and hospitals in different formats. They are not connected or consolidated. As a result, when patients visit different doctors, they have to have tests repeated and scans redone. This adds to unnecessary cost.

Other regions of the world are seeking interoperability as well. Electronic health records have been accepted by the European Union as a standard to be achieved in all European countries regardless of their funding model or infrastructure. Most countries are seeking to achieve this goal in their own way. However, advanced information technology is not the panacea and can create additional problems, including data security, miscoding issues attributed to language variations and lack of broadband capabilities.

Creating a digital backbone requires capital, interoperability, standard-setting and cross-sector collaboration. Thus, implementing an e-Health strategy requires active involvement from government entities and private organisations working in a collaborative fashion with one another. Active partnerships are needed among hospitals, physicians, IT developers and suppliers, and colleges and universities so that they can work together to build the infrastructure, set industry standards and provide the training and research required for success.

Conclusion and Recommendations

Improving transparency of healthcare is a priority for health systems around the world, but a complex issue with no easy solutions, creating additional challenges for healthcare organisations and government. These challenges are exacerbated as pay is tied increasingly to performance and care is sought and delivered across national borders. Questions remain unanswered about who is responsible for mandating, monitoring and measuring quality standards, what information technology is needed to support transparency of quality and pricing, and how published quality data affects referral and payment for medical services.

Moving towards a transparent health community requires maintaining focus on the ultimate goal: Packing information for patients around treatments for a given condition and creating information and incentives that direct providers and patients towards those treatments.

Following are the Recommendations:

• Cooperate on efforts to create interoperarable networks for electronic medical records and clinical systems
• Reduce administrative functions that don’t add value to the transparency continuum
• Focus on information that can be shared without compromising competitive advantage of stakeholders

Author Bio

Sandy Lutz