PATIENT CHOICE Picker Institute Europe is a not-for-profit organisation that makes patients’ views count in healthcare. We build and use evidence to champion the best possible patient-centred care; work with patients, professionals and policy makers to strive continuously for the highest standards of patient experience. The Office of Health Economics provides independent research, advisory and consultancy services on economics and policy issues within the pharmaceutical, health care and biotechnology sectors in the UK and internationally. Its main areas of focus are: the economics of the pharmaceutical and biotechnology industry, the financing, organisation and performance of health care systems, and the economics of health technology assessment. RAND Europe is an independent not-for-profit research institute whose mission is to help improve policy and decision-making through research and analysis. Our research aims to serve the public interest and is carried out on behalf of European governments and institutions, foundations, academic institutions, professional bodies, charitable organisations and private-sector clients with a need for quality-assured, impartial research and analysis. PATIENT CHOICE How patients choose and how providers respond Anna Dixon Ruth Robertson John Appleby Peter Burge Nancy Devlin Helen Magee The King’s Fund seeks to © The King’s Fund 2010 understand how the health system in England can be First published 2010 by The King’s Fund improved. Using that insight, we help to shape policy, transform Charity registration number: 1126980 services and bring about behaviour change. Our work All rights reserved, including the right of reproduction in whole or in part in any form includes research, analysis, leadership development and ISBN: 978 1 85717 596 7 service improvement. We also offer a wide range of resources A catalogue record for this publication is available from the British Library to help everyone working in health to share knowledge, Available from: learning and ideas. The King’s Fund 11–13 Cavendish Square London W1G 0AN Tel: 020 7307 2591 Fax: 020 7307 2801 Email: [email protected] www.kingsfund.org.uk/publications Edited by Kathryn O’Neill Typeset by Grasshopper Design Company Printed in the UK by Hobbs the Printers Limited Contents List of figures and tables v About the authors vii Acknowledgements ix Executive summary xi Introduction 1 Policy background and theory 1 Research aims and approach 3 1 Theory and evidence of patient choice 9 Economic theory, market failure and consumer choice 9 Consumer choice in complex markets 13 ‘Quasi-markets’ and the role of patient choice 17 Empirical evidence 18 Discussion 23 2 Awareness, understanding and opinions of patient choice 25 How aware are patients of their ability to choose? 25 How important is choice to patients? 30 What do GPs and providers think about patient choice? 34 Understanding the objectives of patient choice policy 38 Opinions of Choose and Book 41 Summary 45 3 How is patient choice operating in practice? 47 Are patients offered a choice? 47 Who is offered a choice? 56 Are patients exercising choice? 59 Who is exercising choice? 63 Why are patients choosing particular providers? 69 What support, advice and information do patients receive? 86 Summary 92 © The King’s Fund 2010 Patient choice 4 Does patient choice create competition between providers? 95 Extent of competition in local areas 95 Are providers competing for patients? 101 What are providers competing over? 111 Summary 115 5 How providers have responded to choice, competition and other factors 117 Collecting and using market information 118 Patient choice and quality improvements 124 Discussion 133 6 Choice and competition in a local context 137 How choice works in practice: area A 137 How choice works in practice: area B 138 How choice works in practice: area C 138 How choice works in practice: area D 139 Discussion 139 Summary 141 7 The future of choice and competition 143 Implications and discussion 146 8 Discussion and conclusions 149 Revisiting the analytical framework 149 Patients as informed consumers? 151 GPs as agents of choice 154 Providers’ response to choice 157 Addressing the key policy questions 160 Appendix A Methodology 165 Site selection 165 Patient questionnaire 167 Provider interviews 177 GP interviews 178 PCT interviews 179 Analysis of Hospital Episode Statistics data 179 Expert seminar on project findings 180 Appendix B Patient choice questionnaire 181 References 189 vi © The King’s Fund 2010 List of figures and tables Figure 1 Overview of case study areas 4 Figure 2 Patient choice and system reform: policy timeline 6 Figure 3 A model of patient choice as a driver for quality improvement 7 Figure 4 Analytical framework showing relationship between choice, competition and provider behaviour 7 Figure 5 Awareness of choice and offer of choice (May/June 2006 to March 2009) 26 Figure 6 The choices offered to patients 48 Figure 7 Who offered you a choice of hospital? 49 Figure 8 How the hospital appointment was booked 50 Figure 9 Offer of choice by PCT of residence 54 Figure 10 Number of choices offered by PCT of residence 54 Figure 11 Offer of choice and location of treatment 60 Figure 12 Offer of choice and attending the hospital the patient wanted 61 Figure 13 Responses over the sequence of stated preference choices 66 Figure 14 Characteristics of respondents more likely to choose their local hospital in the discrete choice experiment 67 Figure 15 Characteristics of respondents more likely to choose a non-local hospital in the discrete choice experiment 68 Figure 16 Factors that influence patients’ choice of hospital 70 Figure 17 Characteristics of the hospital and its environment, and the relationship with choice of hospital 81 Figure 18 Hospital performance and the relationship with choice of hospital 81 Figure 19 Trade-off between hospital performance ratings and travel time 82 Figure 20 Trade-off between waiting times and travel time 83 Figure 21 The importance of different sources of opinion on choice of hospital 84 Figure 22 Sources of advice to help patients choose 87 Figure 23 Sources of information to help patients choose 88 Figure 24 Sources of information on the performance of local hospitals 89 Figure 25 Patients’ views on the amount of information given 90 © The King’s Fund 2010 vii Patient choice Figure 26 Proportion of outpatient referrals for PCT A received by the main NHS providers and overall referral numbers 2005–2008 97 Figure 27 Proportion of outpatient referrals for PCT B received by the main NHS providers and overall referral numbers 2005–2008 98 Figure 28 Proportion of outpatient referrals for PCT C received by the main NHS providers and overall referral numbers 2005–2008 99 Figure 29 Proportion of outpatient referrals for PCT D received by the main NHS providers and overall referral numbers 2005–2008 100 Table 1 Awareness of choice by patient characteristics 26 Table 2 Binary logistic regression model of awareness of choice before visiting the GP 27 Table 3 Awareness of choice and private sector options for NHS and ISTC patients 28 Table 4 Patients’ awareness of advertising related to choice 28 Table 5 Awareness of choice and private sector option by PCT of residence 30 Table 6 The importance of being offered a choice of hospital by demographics, type of hospital attended and PCT of residence 31 Table 7 Binary logistic regression model of the importance of choice 32 Table 8 The choices offered to NHS and ISTC patients 48 Table 9 Binary logistic regression model of recall of choice 58 Table 10 Binary logistic regression model of travelling beyond the local provider for treatment 64 Table 11 Offer of choice and the amount of information wanted to help respondents choose 91 Table 12 Description of nature of competition in each local health economy as described by providers 96 Table 13 The reality of patient choice at the point of referral in England 150 Table A1 Attributes and levels included in the discrete choice experiment 169 Table A2 Provider sample size and response rates 172 Table A3 Description of the sample 172 Table A4 Revealed preference model: information on provider performance 174 Table A5 Number of provider interviewees 177 Table A6 Characteristics of GP participants 179 viii © The King’s Fund 2010 About the authors Anna Dixon is Director of Policy at The King’s Fund. She has conducted research and published widely on health care funding and policy. She has given lectures on a range of topics including UK health system reform and patient choice. She was previously a lecturer in European Health Policy at the London School of Economics and was awarded the Commonwealth Fund Harkness Fellowship in Health Care Policy in 2005–6. Anna has also worked in the Strategy Unit at the Department of Health where she focused on a range of issues including choice, global health and public health. Ruth Robertson is a Senior Researcher in the policy department of The King’s Fund. Her research on the impact of health system reforms has included a two-year evaluation of practice-based commissioning. Previous work focused on ways to promote behaviour change among health practitioners, patients and healthy people. Ruth previously worked at the Healthcare Commission, and holds an MSc in social policy and planning from the London School of Economics. John Appleby is Chief Economist at The King’s Fund. He is an honorary professor at the Department of Economics, City University. The focus of his research and commentary work at The King’s Fund is on current health policy matters, in particular the economic issues associated with the government’s reform agenda for health care such as the introduction of competitive forces into the NHS, the use of targets to reduce waiting times, patient choice, Payment by Results and patient- reported outcome measures (PROMs).