Information on Health Care Cost and Quality

There are multiple ways to assess the cost of health care. Information from Two Selected Consumer Transparency Tools Consistently Demonstrated Substantial Cost Variation Regardless of Quality for Certain Services

The two selected consumer transparency tools we reviewed show that  some providers are paid thousands of dollars more than others for the  same service in the same geographic area, regardless of the quality of  such services. For example, according to information  obtained from Castlight, the estimated total cost of maternity care at  selected acute care hospitals in the Boston area that rated more highly on  several quality indicators ranged between $6,834 and $21,554  (consumers would pay between $2,967 and $5,000 in estimated out-of- pocket costs). Effective Transparency Tools Provide Cost and Quality Information That Is Relevant and Understandable to Consumers

Transparency tools are most effective if they both provide information  relevant to consumers and convey that information in a way that  consumers can readily understand. 4. Describe key differences in costs, particularly patient out-of- pocket costs. 3. Enable consumers to customize information selected for  presentation to focus on what is most relevant to them. CMS Transparency Tools Are Limited in Their Provision of Relevant and Understandable Cost and Quality Information for Consumers

The CMS transparency tools we evaluated are limited in the relevance  and understandability of cost and quality information they provide to  consumers. CMS Transparency Tools Lack Certain Relevant Information Needed to Make Meaningful Distinctions about the Cost and Quality of Providers

Based on the characteristics we identified concerning information  provided to consumers by effective transparency tools, we found that  CMS’s tools demonstrate a number of the characteristics of effective  transparency tools, such as timeliness of data; however, the tools lack  relevant information on cost and key differences in quality of care. These limitations hinder their relevance and usefulness by consumers,  particularly consumers’ ability to make meaningful distinctions among  providers. Therefore,  they do not allow consumers to combine cost and quality information to  assess the value of health care services, or anticipate and plan for  expenses related to non-emergency procedures. Specifically, the  tools have substantial limitations in their use of clear language and  symbols, in summarizing and organizing information to highlight patterns  for consumers, and in enabling consumers to customize how information  is presented. Additionally, the CMS tools also generally do not summarize results for  consumers—with the exception of Nursing Home Compare—or organize  data to highlight patterns. CMS Has Taken Limited Steps to Expand Access to Cost and Quality Information, but Has Not Established Procedures to Ensure This Information Meets Consumer Needs

CMS has taken limited steps in three key areas to expand information on  cost and quality and increase transparency to consumers and others. CMS Has Not Established Procedures to Ensure the Cost and Quality Information It Collects and Reports Meets Consumer Needs

Although HHS has included transparency as part of its strategic plan, and  set a specific goal to report on measures that meet consumer needs, it  has not established specific procedures or performance metrics to ensure  that the cost and quality information that it collects and publicly reports  accomplish this goal. Without such  specific procedures and performance metrics, CMS cannot ensure that its  efforts to make cost and quality information publicly available will meet  consumer needs or help them to make meaningful distinctions among  providers. In  particular, CMS’s process for developing and selecting cost and quality  measures for its tools has been heavily influenced by the concerns of  providers rather than consumers, which helps to account for the relative  lack of cost and quality information in CMS’s tools that consumers would  find relevant. HHS also provided us with technical comments, which we  incorporated as appropriate. Appendix I: Examples of Variation in Cost and Quality Information Available to Consumers for Selected Procedures

We obtained examples of cost and quality information that were available  to certain consumers in specific circumstances by obtaining information  from selected transparency tools and by contacting providers, acting in  the role of a consumer, to ask for cost and quality information. Appendix II: Assessment of CMS Transparency Tools

We assessed the extent to which the Centers for Medicare & Medicaid  Services’ transparency tools include the 15 characteristics of effective  tools we identified through our literature review and interviews with  experts.
Why GAO Did This Study

The cost and quality of health care services can vary significantly, with high cost not necessarily indicating high quality. As consumers pay for a growing proportion of their care, they have an increased need for cost and quality information before they receive care, so they can plan and make informed decisions. Transparency tools can provide such information to consumers and others.
GAO was asked to study cost and quality information for consumers. This report examines (1) information on cost and quality available to consumers from selected transparency tools, (2) characteristics of effective transparency tools, (3) limitations, if any, in the effectiveness of CMS transparency tools, and (4) CMS efforts to expand cost and quality information available through transparency tools. GAO analyzed information from two private tools—selected because they had both cost and quality information—and CMS's five transparency tools, reviewed research to identify best practices for conveying information to consumers, interviewed CMS and HHS officials and subject matter expects, and reviewed CMS and HHS planning documents and relevant criteria for effective planning in the federal government.

What GAO Found

Results obtained from two selected private consumer transparency tools GAO reviewed—websites with health cost or quality information comparing different health care providers—show that some providers are paid thousands of dollars more than others for the same service in the same geographic area, regardless of the quality of such services. For example, the cost for maternity care at selected acute care hospitals in Boston, all of which rated highly on several quality indicators, ranged between $6,834 and $21,554 in July 2014.
Transparency tools are most effective if they provide information relevant to consumers and convey information in a way that consumers can readily understand. GAO identified key characteristics of effective transparency tools through a literature review and interviews with experts. The information that is most relevant to consumers relates directly to their personal circumstances, such as information on specific procedures they are considering, and allows them to make meaningful distinctions among providers based on their performance. Characteristics of such relevant information include describing key differences in quality of care and costs, particularly for what consumers are likely to pay out of pocket based on their specific circumstances. In addition, effective transparency tools must take specific steps to make the information they present understandable by consumers. For example, tools must enable consumers to discern patterns by summarizing related information and allowing consumers to customize information to focus on what is most relevant to them.
The Centers for Medicare & Medicaid Services (CMS) operates five transparency tools—Nursing Home Compare, Dialysis Facility Compare, Home Health Compare, Hospital Compare and Physician Compare—that are limited in their provision of relevant and understandable cost and quality information for consumers. In particular, GAO found that the tools lack relevant information on cost and provide limited information on key differences in quality of care, which hinders consumers' ability to make meaningful distinctions among providers based on their performance. Because none of the tools contain information on patients' out-of-pocket costs, they do not allow consumers to combine cost and quality information to assess the value of health care services or anticipate the cost of such services in advance. Additionally, GAO found substantial limitations in how the CMS tools present information, such as, in general, not using clear language and symbols, not summarizing and organizing information to highlight patterns, and not enabling consumers to customize how information is presented.
CMS, part of the Department of Health and Human Services (HHS), has taken some steps to expand access to cost and quality information for consumers, but has not established procedures or metrics to ensure the information it collects and reports meets consumer needs. Both HHS and CMS have set goals to report on measures that meet consumer needs. However, CMS's process for developing and selecting cost and quality measures for its tools has been heavily influenced by the concerns of providers rather than consumers. Without procedures or metrics focusing on consumer needs, CMS cannot ensure that these efforts will produce cost and quality information that is relevant and understandable to consumers seeking to make meaningful distinctions.

What GAO Recommends

GAO recommends that HHS's CMS take steps to improve the information in its transparency tools and develop procedures and metrics to ensure that tools address consumers' needs. HHS concurred with the recommendations and provided technical comments that were incorporated as appropriate.