A comparison of methods for combining quality and efficiency performance measures: Profiling the value of hospital care following acute myocardial infarction

Health plans have begun to combine data on the quality and cost of medical providers in an attempt to identify and reward those that offer the greatest 'value.' The analytical methods used to combine these measures in the context of provider profiling have not been rigorously studied. We propose three methods to measure and compare the value of hospital care following acute myocardial infarction by combining a single measure of quality, in-hospital survival, and the cost of an episode of acute care. To illustrate these methods, we use administrative data for heart attack patients treated at 69 acute care hospitals in Massachusetts in fiscal year 2003. In the first method we reproduce a common approach to value profiling by modeling the two case mix-standardized outcomes independently. In the second approach, survival is regressed on patient risk factors and the average cost of care at each hospital. The third method models survival and cost for each hospital jointly and combines the outcomes on a common scale using a cost-effectiveness framework. For each method we use the resulting parameter estimates or functions of the estimates to compute posterior tail probabilities, representing the probability of being classified in the upper or lower quartile of the statewide distribution. Hospitals estimated to have the highest and lowest value according to each method are compared for consistency, and the advantages and disadvantages of each approach are discussed. Copyright (C) 2007 John Wiley & Sons, Ltd.