Measuring healthcare payor management practices in England

Good management practice in healthcare payors and providers is considered central to ensuring health systems respond to population needs, contain costs, and improve both quality and outcomes. However, the evidence to support this assertion is sparce. While a quantitative link between better management practice and improved patient outcomes has been demonstrated for healthcare providers, no such link has been identified for healthcare payors. The lack of a robust tool to assess the management practices of healthcare payors has impeded such quantitative assessments. We report upon a novel tool developed to measure and assess 11 management practices in all 152 healthcare payors within England's National Health Service in 2010. We have tested the acceptability, reliability and validity of this tool using rigorous analytic methods and present four key findings. First, performance of the tool is strong and comparable to management practice scorecards used in other settings. Second, exploratory factor analysis indicates the tool measures two distinct latent factors of healthcare payor management practice with high internal consistency and reliability. Third, there is evidence of assessment and score validity. Fourth, payor management practice variations are associated with the degree of supervisory oversight. While deploying such a tool is challenging, these results suggest that healthcare payor management practices can be measured and assessed robustly. This could enable governments, and others, to identify how payor management practices influence health system performance and to estimate what health system performance improvements they should expect from interventions designed to improve the management practices of their local healthcare payors.