Measuring and improving performance

Improvement of health service performance is a central concern in all countries – what is the evidence on how costs can be reduced and quality can be enhanced? A major challenge in the context of healthcare is how best to define and measure quality, the subject of a substantial body of health services research. This theme begins with research that sought to incorporate quality measures in estimates of productivity and to investigate variation in performance to highlight the potential for improvement. An important advance in our ability to measure quality, from the perspective of recipients of health care, was the development and roll-out of Patient Reported Outcome Measures, the subject of our second case study. Having better measures of quality in turn allows research to identify effective mechanisms for achieving performance improvement in specific contexts and circumstances, the topic of the final two case studies. Research demonstrates the potential for competition in the hospital sector to drive quality improvement, but only when operating in the context of centrally determined fixed prices; otherwise, there is a risk that quality will deteriorate. Evidence from a natural experiment shows that there is a role for performance targets in producing performance gains in healthcare systems, but only where the targeted outcome can be measured directly and accurately; if it is not, the system may be open to manipulation, potentially reducing patient benefits.