Association for Public Policy Analysis & Management

Healthcare quality research in the U.S. until now has majorly focused on patient characteristics, demographics and socioeconomic factors, and only limited research has tapped patient perceptions of quality, for e.g., Levine et al. (2017) and Carter et al. (2017). Both studies found low readmissions associated with high patient satisfaction, but no research has yet analyzed variance in patient perceptions of quality, and drivers of patient perceptions among for-profit corporate-owned, physician-owned, and not-for-profit hospitals. Also, there is limited comparative research on quality and effectiveness of hospital structures. Blumenthal et al.’s (2015) comparative research was bimodal, comparing only physician-owned and non physician-owned hospitals in the U.S.

This paper examines associations between provider practices and patient perceptions of quality, and identifies major drivers for patient perception of quality and also whether quality perceptions translate into quality outcomes among for-profit corporate-owned, physician-owned, and not-for-profit hospitals. Patient-centered care was first endorsed by The US Institute of Medicine as one of the six goals for improving healthcare quality generally, but only with the implementation of The Patient Protection and Affordable Care Act (ACA) patient-centered care slowly started replacing the fee-for-service culture, which has dominated the healthcare sector generally until now, with a pay-for-performance culture. To ensure quality patient-centric care generally among all hospitals, the ACA established a regime of quality and organizational sanctions through its various sections (for e.g., Section 3001(a) on Hospital Value-Based Purchasing Program, Section 3008 on Hospital Acquired Condition Reduction Program, Section 3025 on Hospital Readmission Reduction Program, and Section 6001 that regulates physician-owned hospitals in the U.S.). Because of this cultural change, importance of patient perceptions of quality is being reconsidered for improving quality of care and effectiveness of hospitals in providing quality care to patients.

The dependent variable, patient perceptions of quality care, is tapped by patient satisfaction. Patient satisfaction and perceptions of care are assessed by the Centers for Medicare and Medicaid Services (CMS) through HCAHPS surveys of discharged patients. This quantitative study is anticipated to have scholarly and public affairs significance. Existing scholarship on organizational effectiveness recognizes both quality and outcomes as significant indicators of organizational effectiveness. Via quality, we may be able to make claims about organizational effectiveness and its nature. Depending on the relationship between quality perceptions and outcomes, we may be able to substantively claim whether organizational effectiveness is only about managing patient perceptions, or more substantial than that. If quality perceptions have high correlation with quality outcomes (for e.g., lower readmissions), reconsidering existing governance practices and structures may suggest normative ways of achieving yet higher levels of organizational effectiveness. Administrators and providers may be able to find better balance between patient expectations and organizational capacities. More effective policies could be designed based on identified patient-centric values, which could also be valuable in further reducing preventable readmissions that increase healthcare expenditures each year.