Public reporting of comparative information on healthcare quality of physicians and hospitals through ‘report cards’ is hailed as a plausible way to improve health care (Arrow, 1963; Akerlof, 1970; Stiglitz et al., 1989). Without this information, patients may choose their physicians based on more measurable characteristics (such as cost) or by word-of-mouth or other informal referral practices not obviously related to their needs.
There are two general types of healthcare report cards: those that measure outcomes and those that measure process. Reports of cardiac surgeons' and hospitals' risk-adjusted mortality rates following coronary artery bypass graft (CABG) surgery are examples of outcomes-based reporting (Pennsylvania Health Care Cost Containment Council, 1992; New York State Department of Health, 1993; California CABG Mortality Reporting Program, 2001; New Jersey Department of Health and Senior Services, 2003). Process-based report cards, often called quality indicators, report on rates of medical interventions, such as screening tests and medication usage, which are assumed to be related to outcomes. The Centers for Medicare and Medicaid Services (CMS) nursing homes report card, reporting on quality of care in nursing homes nationwide (2003), the Agency for Healthcare Research and Quality's congressionally mandated National Healthcare Quality Report, reporting on 150 measures of quality (2003), and the National Committee for Quality Assurance Health Plan Employer Data and Information Set (HEDIS), which includes quality indicators on health plan performance (2004) are examples of report cards that use process measures.