Publicly Reported Quality Ratings have Small but Positive Effect on Patient Choice of Nursing Home for Post-Acute Care
A key strategy used by policymakers to improve healthcare quality is the release of "report cards" that publicly report information about the quality of healthcare providers. Report cards can enable consumers to identify and choose high-quality providers, and, in turn, give providers incentives to improve their quality so they can increase demand for their services. Despite the face validity of using report cards to increase demand for highly-rated providers, the evidence that providers who receive a high report card rating are rewarded with an increased market share - or that providers who receive a low report card rating lose market share - is mixed. This study examined the relationship between report card scores and patient choice of nursing home after the Centers for Medicare and Medicaid Services began publicly reporting nursing home quality information on post-acute care in 2002. Post-acute care provides a "short-stay" transition between hospitalization and home (or another long-term care setting) for more than five million Medicare beneficiaries each year. Investigators compared the relationship between consumer choice and report card scores before and after these scores were publicly released, and included all nursing homes large enough to be included in public reporting (n=7,675) during the period of study analyses (2000-2003). The primary data source for this study was the Minimum Data Set (MDS), which contains detailed clinical data collected at regular intervals for every resident in a Medicare- or Medicaid-certified nursing home.
- Patients were more likely to choose facilities with higher reported post-acute care quality related to resident pain control after public reporting was initiated; however, the magnitude of the effect was small.
- No changes in nursing home choice related to report card scores was seen in facilities not exposed to public reporting.
- A better pain score (less pain experienced by the patient) was associated with an increase in consumer demand after public reporting was initiated; for delirium, there was no significant effect, and for improved walking, the effect was unexpectedly negative.
- There was a differential response across patients by education level, which raises the possibility that the format and distribution of this information matters. Authors suggest that this information may be more influential if it is delivered to consumers in a more user-friendly format, or if it is delivered to patient advocates or surrogate decision-makers.
- The demand response found in nursing homes in this study may not be generalizable to other healthcare settings.
- Patients needing post-acute care are likely to be older with worse health status, making the search for information more difficult than among younger populations studied in non-nursing home settings. Thus, the effect of information on demand might be larger in other settings.
Dr. Werner was supported through an HSR&D Career Development Award; she is part of HSR&D's Center for Health Equity Research and Promotion in Philadelphia, PA.
Werner R, Norton E, Konetzka R, Polsky D. Do Consumers Respond to Publicly Reported Quality Information? Evidence from Nursing Homes. Journal of Health Economics January 10, 2012;31(1):50-61.