Creating Public-Private Partnerships

Improving the quality of health care in America must be a national priority that begins with leadership by the President and the Congress and extends to all levels of the health care industry. Uppermost on the national agenda should be initiatives designed to focus attention on specific priorities for improvement and to coordinate the wealth of existing resources in partnership efforts to address those priorities. The first step will be to establish national aims for improving the quality of health care (see Chapter 3). Then core sets of quality measures that relate to the aims and that are applicable to each sector of the health care industry will need to be identified, and a strategy for standardized reporting of the measures defined and implemented (see Chapter 4). These actions will provide the means to track progress in meeting national aims and to generate the comparative information needed to support efforts to improve quality, promote accountability, and make sound public health and policy decisions.

To provide ongoing leadership for these efforts, the Commission recommends creation of two complementary bodies, one lodged in the public sector, the other in the private sector. The first entity, an expert Advisory Council for Health Care Quality, would advance and influence the public agenda with respect to quality of care. The Advisory Council would focus on defining, updating, tracking, supporting, and reporting on national aims for improvement. It also would track the industry's efforts to establish an environment in which quality improvement can occur through full, systemwide implementation of the Consumer Bill of Rights and Responsibilities (see Chapter 9). Complementing the efforts of the Advisory Council would be a Forum for Quality Measurement and Reporting, a group representing key stakeholders, convened to provide coordination and guidance to the multiple public and private-sector parties involved in evaluating health care quality. The Forum's objective would be to develop an effective and efficient way to focus incentives for quality improvement on national priorities while assuring the public availability of information needed to support the marketplace and oversight efforts.


An Advisory Council for Health Care Quality should be created in the public sector to provide ongoing national leadership in promoting and guiding continuous improvement of health care quality. The expert Advisory Council would identify national aims and specific objectives for improvement and would establish goals and objectives for systemwide quality measurement. It also would track and report on the nation's progress in (1) achieving the national aims for improvement; (2) undertaking related quality measurement and reporting; and (3) implementing the Consumer Bill of Rights and Responsibilities. The Advisory Council's additional responsibilities would be to provide a public forum for addressing quality improvement and consumer protection issues, assess relevant policy proposals, make recommendations on strategies for quality improvement, develop and promote an agenda for quality research, track key health system indicators, support and foster approaches to improve the dissemination of effective health care practices, and guide public education and communication efforts pertaining to quality. The Advisory Council would issue an annual public report on the findings from its tracking activities and recommendations for any steps needed to improve.

A Forum for Health Care Quality Measurement and Reporting should be created in the private sector to improve the effectiveness and efficiency of health care quality measurement and reporting. The Forum would define a comprehensive plan for implementing quality measurement, data collection, and reporting standards consistent with the national aims and the goals and objectives for quality measurement put forward by the Advisory Council. The objective of this plan would be to assure the widespread public availability of comparative information on the quality of care furnished by each sector of the health care industry, to be accomplished through the coordinated efforts of existing quality measurement organizations and initiatives. The Forum would be responsible for identifying and updating core sets of quality measures and standardized reporting methods. The Forum's work also would focus on establishing measurement priorities, soliciting the voluntary participation of key organizations, assessing the use of the core sets of measures and the extent of publicly available information generated through reporting efforts, providing input to an agenda for research on quality measurement, developing strategies for quality information dissemination and public education on measurement issues, and fostering development of improved health information systems.


Through the Commission's work to assess the current state of health care quality and to identify strategies for improvement, several principles emerged. These principles assisted in defining an effective and efficient approach for undertaking the actions needed to make quality improvement both a national priority and an attainable goal. The Commission determined that, to be successful, its recommended approach would need to:

Facilitate and promote coordinated, partnership efforts of the public and private sectors. A national initiative to provide leadership and direction to quality improvement in the health care industry clearly will need to rely on collaborative efforts of the public and private sectors. Through coordinated efforts, the two sectors' relative strengths can complement each other and compensate for the weaknesses inherent in each alone.

The U.S. health system is characterized by the intertwined activities of the public and private sectors in the delivery, purchase, and oversight of health care. Despite ongoing change in the system, these important and overlapping roles are likely to continue for the foreseeable future. As documented in this report (see Chapter 6), both the public and private sectors are substantial purchasers in the health care marketplace. As such, they collectively bring considerable market power to influence the health care industry. In addition, both sectors have contributed to the base of knowledge and experience concerning quality measurement and reporting. Quality oversight organizations operating in both sectors have employed that knowledge and experience to undertake initiatives designed to protect consumers and improve the quality of health care.

In addition to their common characteristics and contributions to the health system, each sector offers unique strengths. Private-sector organizations have the capacity to act in the timely and nimble manner needed to keep pace with the swiftly evolving health system. The public sector moves more slowly, but provides established channels and safeguards to ensure representative action and open proceedings. In a combined effort, the nimbleness of the private sector can compensate for the slower deliberative processes inherent in the public sector, while the greater representativeness of public processes can inform the more focused efforts of the private sector.

Build on existing resources, experience, and expertise. A successful national effort to improve health care quality will need to build on existing resources, experience, and expertise. Any steps taken or structures created should endeavor to promote and strengthen the significant and innovative work now under way. Competing with, stifling, or slowing down these actions will not advance the nation's agenda for quality improvement.

The health care industry has taken many of the needed steps toward building the capacity for systemwide improvement, and a number of organizations and initiatives are positioned to take action. Public and private-sector oversight organizations, purchasers, consumer groups, health care organizations and providers, researchers, and others have provided a strong foundation in terms of quality improvement, measurement, and reporting methods that deserve promotion and extension (see Chapter 4). In addition, there are now an extensive number and variety of organizations and initiatives devoted to the oversight of health care quality (see Chapter 9).

The challenge that confronts the nation today is to build upon the wide range of existing resources, experience, and expertise through leadership aimed at increasing coordination and focus. Because of the existing array of public and private oversight bodies, the Commission does not propose the creation of additional regulatory entities, but does believe that the programs and resource utilization of existing entities could be better coordinated. Efforts to improve the effectiveness and efficiency of health care quality measurement and reporting should strongly involve quality oversight organizations and seek to encourage coordination among them.

Utilize and strengthen emerging market forces. Mechanisms are needed to support and promote a balanced approach to the use of market forces to advance the nationwide quality improvement agenda. Both public and private group purchasers as well as consumers should be encouraged and enabled to play leading roles.

The use of market forces to advance a quality improvement agenda for health care, though not yet well developed, holds much promise. Group purchasers, including employers and public program administrators, have begun to use their organization and clout to drive progress in the quality measurement and reporting field. There are also a number of existing market-oriented mechanisms for oversight, including accreditation standards and purchasers' requirements of their contractors, that can serve as vehicles for advancing a national quality agenda.

Many steps -- detailed in this report -- can and should be taken to strengthen the emerging health care marketplace. For instance, value-based purchasing by group purchasers, consumers, and other health care decisionmakers has the potential to stimulate quality improvement. Steps to assure the availability of information on quality and the opportunity for choice would empower purchasers to hold the health care industry accountable for quality improvement.

Because market forces have yet to be fully tested as a tool for quality improvement in the health care industry, the Commission recognizes the need to track closely the health care industry's efforts to voluntarily undertake needed improvements and the success of those efforts. Careful tracking and reporting on these efforts will allow for adjustments, as needed, to stay on course.

Strengthen the capacity of consumers to function in the marketplace. Any mechanisms introduced to facilitate quality improvement should strengthen the capacity of consumers to function in the marketplace by encouraging the health care industry's implementation of the Consumer Bill of Rights and Responsibilities. As discussed in Chapter Seven, consumers have a critical role to play in stimulating quality improvement. The Consumer Bill of Rights and Responsibilities provides a means of supporting consumers' ability to fulfill that role. It assures consumers that the health care system will be fair and responsive to their needs; that they will be provided with credible and effective mechanisms to address their concerns; and that they will be provided with the information they need to make quality-based decisions about their health care. It further empowers consumers by encouraging them to take an active role in improving and assuring their own health.

Incorporate the views and expertise of all stakeholders. Advancing a quality agenda will both require and benefit from the commitment and active participation of multiple parties. Quality oversight organizations, group purchasers, consumers, public health officials, and health care organizations need information on quality to inform their purchasing or policy decisions. Individual practitioners and health care organizations also will be required to produce data and information on quality for both external and internal purposes. In order to provide information that is useful to these parties (thereby enhancing the likelihood of their commitment to and participation in quality improvement efforts) the views of these stakeholders should be aggressively solicited as part of the national quality agenda-setting process. Because not all stakeholders will be able to directly participate in the agenda setting processes, it is critical that these processes are open, accessible, and accountable to the public, and generate information that is easily available to all parties with an interest in health care quality.

Provide stable and predictable mechanisms for implementing a quality agenda. Implementing a national quality improvement agenda will require stable and predictable supporting mechanisms. In the course of its work, it became clear to the Commission that two mechanisms would need to be created to spur quality improvement: a catalyst and an agent for undertaking coordinated action. These mechanisms would need to be structured in a way to accommodate the rapid change that presently characterizes the health care industry as well as to encourage desired characteristics of the health care marketplace. They will require stable funding sources and support from all sectors of the health care industry.

As mechanisms are established to advance a quality improvement agenda, processes for prospectively analyzing their anticipated costs, benefits, and other effects should be conducted. The effectiveness of such mechanisms also should be retrospectively assessed.


The Commission has identified an approach for creating stable, predictable mechanisms to serve as a catalyst and an agent for national, systemwide quality improvement. The Commission's recommended approach features a public-sector body -- the Advisory Council for Health Care Quality -- that would establish the national quality improvement agenda and a framework for action. It also relies on a private-sector body -- the Forum for Health Care Quality Measurement and Reporting -- that would coordinate existing resources and harness market forces toward implementing the nation's agenda for improvement.

A Two-Entity Approach

The two-entity structure that characterizes the Commission's recommended approach emerged after extensive discussions of various public and private-sector models, which resulted in a recognition that each has strengths and weaknesses, advantages and disadvantages. It represents compromises on the part of many, if not most, members of the Commission.

Key to developing the Commission's recommended approach was recognition that there was a strong need for a mechanism by which to provide ongoing, national leadership for health care quality improvement. Such a structure would need to be lodged in the public sector to have the high visibility essential for both drawing upon and influencing leaders from across the public and private sectors.

At the same time, the value of establishing standards for quality measurement and reporting through private-sector channels was evident. The Commission clearly recognized the progress that private-sector organizations have made in developing these types of standards. It sought to identify a mechanism that would further stimulate that effort while assuring the implementation of a comprehensive quality measurement and reporting framework with core sets of measures applicable to each sector and adhered to by all organizations or providers within that sector. It did not seek to create a new quality oversight organization or to displace the work of existing organizations, but rather to provide a forum in which the work of those groups could be better coordinated and focused on common goals for systemwide quality improvement.

While members of the Commission were united in their support for work under way in the quality measurement field, Commission members held varying degrees of confidence in the likelihood that a purely private-sector approach that focused on increasing coordination among the existing groups would yield a fully successful outcome. The decision to provide the Advisory Council with responsibilities for tracking the Forum's influence on the health care industry was made to increase the odds of success and to put the Advisory Council in a position to determine the need for, and timing of, additional interventions.

There are concerns on the part of some about creating too strong a public-sector role that could stifle innovation. This clearly is not the Commission's intent. The Advisory Council's role should be limited to one of providing advice and guidance to policymakers, the health care industry, the Forum, and others.

The Commission intends that the two entities would support each other's work and believes that each would be strengthened by the other. Both the Advisory Council and the Forum would have public and private sector participation, and there would be coordination between the activities of the two. These three aspects -- bi-location in the public and private sectors, public and private composition, and coordination and communication between the two entities -- will maximize the effectiveness of public-private partnerships.

Advisory Council for Health Care Quality

An Advisory Council for Health Care Quality is proposed to provide the ongoing national leadership necessary to promote and guide a nationwide agenda to improve health care quality. Its work would relate to three key objectives:

Activities. A primary responsibility of the Advisory Council would be to identify and periodically update national aims and specific accompanying objectives for improving health care quality and to track the nation's progress in achieving them. As identified in Chapter Three, aims for improvement would define needs for improvement in areas such as:

As part of this effort, the Advisory Council will need to develop goals and objectives for systemwide measurement and reporting on the health care industry's success in meeting the established aims for improvement. It would monitor the progress of the health care industry -- as coordinated through the Forum -- in identifying core sets of quality measures and in implementing a reporting strategy designed to assure the ready public availability of comparative reports on the quality of care furnished by all sectors of the health care industry.

Other critical activities to be performed by the Advisory Council include:

The Advisory Council would report annually to the President and the Congress on the state of quality in the health care industry. This report also would provide information on the progress of the health care industry in achieving the national aims and in implementing the Consumer Bill of Rights. It would include recommendations on any steps identified as needed to improve quality and assure consumer protection.

Structure. Because the purpose of this entity is to advance national aims and issues pertaining to the public's health, the entity would be located in the public sector. The entity would not itself have any regulatory authority to assure that other public and private entities take action on its findings, but would work closely with existing Federal and State oversight agencies, public and private purchasers, and key organizations and leaders in the private sector to promote widespread adoption of its products and recommendations. In addition, the Advisory Council could exert influence by assessing the performance of the health care system, and through its reports, provide feedback to the industry, governmental entities, and the public.

To assure that improving health care quality remains a high priority on the Nation's agenda, the Advisory Council should be created by and convened at a high level of the Federal government, have stable funding, and report annually to the President and Congress. Its creation should be accompanied by provisions for evaluating its performance five years after its creation to assess both its effectiveness and the continuing need for its services.

The Advisory Council would be composed of 16 to 20 persons who have demonstrated expertise and experience in studying, analyzing, or taking action to improve health care quality. Membership would be drawn from both the public and the private sectors, and would include individuals with familiarity and expertise in these key areas:

Council members would serve in a part-time capacity, convening at periodically scheduled public meetings.

The Advisory Council will require a full-time professional staff, as well as mechanisms for accessing external experts to perform activities related to the above tasks, including; establishing criteria for identifying aims; conducting synthesis of clinical research literature to identify where improvements can occur; and undertaking research to inform the Council's priority-setting among potential competing aims for improvement. It also will require significant expert input and data resources from existing public-sector agencies and private-sector organizations to effectively carry out its activities.

Forum for Health Care Quality Measurement and Reporting

A Forum for Health Care Quality Measurement and Reporting should be established to undertake focused work in an area that is critical to improvement efforts: assuring the systemwide capacity to evaluate and report on the quality of care. The Forum is intended to develop and implement effective, efficient, and coordinated strategies for assuring the widespread public availability of valid and reliable information on quality for use by consumers, purchasers, oversight organizations, providers, and other interested parties. The reporting of standardized quality measures will be essential for accomplishing the national aims for improvement.

Activities. To achieve its objectives, the Forum will work to:

Critical to the Forum's efforts will be the voluntary participation of key organizations involved in promulgating quality measures and collecting information on the performance of various sectors of the health care industry. Key organizations include those that undertake efforts on a national basis, as well as those emerging and established groups organized at the regional, state, or local levels. It will be critically important for the Forum to encourage the continued work and development of local, state, and regional groups, which will provide the means of bringing the resources and knowledge needed for this national initiative for application at the local level. The Forum will need to assist these organizations to implement coordinated plans for the development of specific quality measures that address the measurement priorities and to generate the information on performance that is needed to track aims for improvement. The Forum will need to work with these organizations to determine how best to assure that data are available, affordable, and easily accessible in the public domain. The Forum itself would not compete with the innovative work already under way in the public and private sectors by developing performance measures itself, but would instead seek to encourage the progress being made in this area and improve it through greater coordination.

To evaluate the success of its efforts, the Forum will need to create and utilize feedback mechanisms designed to assess the feasibility and acceptance of the measurement sets it promulgates as well as the extent to which information is reported, available, and used by interested parties. Armed with this information, the Forum will be able to initiate improvement strategies as necessary.

Structure. Operating in the private sector will provide the Forum with two needed characteristics. First, it will have greater flexibility and the means to act quickly to respond to changes in the health system and advances in technology that have implications for measurement and reporting strategies and capacity. Second, it will be well-positioned to harness and coordinate the market forces needed to drive this initiative.

The Forum will need to be broadly representative of stakeholders. The users and potential users of information on quality must be involved in the process of identifying core quality measures for reporting if those processes are to succeed in addressing their common information needs. The Forum also would need to feature a core constituency of influential stakeholders that can assure the implementation of the measures once they are promulgated. Because the Forum would operate in the private sector and would be a voluntary initiative, its success will depend upon the commitment and influence of a critical mass of stakeholders in the health care marketplace. Compliance with reporting requirements would be attained by purchasers and oversight bodies (i.e., accreditation, certification and licensure entities) by the mechanisms available to them (e.g., purchasing contracts and oversight processes). A decision to participate in the Forum would be intended to constitute an endorsement of its work and an agreement to leverage compliance with the results to the full extent of the participant's ability.

The Forum would be governed by a board that includes:

Substantial representation on the board of purchasers from both the public and private sectors and of consumer organizations will be critical to provide strong incentives for organizations to participate in these efforts and to abide by the decisions of the Forum. Representation of the full array of key constituencies on the board will be equally critical, so as to assure the buy-in of all participants and the requisite expertise to effectively carry out the Forum's responsibilities.

In addition, because the Forum will include entities that have multiple roles, it will need to utilize policies and procedures that provide for public input, deliberate publicly, provide for public access to documents produced, and develop other policies and procedures to ensure the integrity of the work, promote widespread confidence in its outcomes, and minimize potential conflicts of interest. The Forum's ongoing activities would be financed by a dues-paying schedule for members.

Since the success of the Forum will depend on the voluntary participation of key stakeholders, it is recommended that a planning process be quickly commenced to involve those stakeholders in working through critical issues related to governance, organizational structure, and financial support. The President and the Vice President might play an important role in appointing a Blue Ribbon Task Force to oversee this process, which should make use of a neutral convener and be supported through a small grant from a private foundation. Individuals selected to participate in this process should be appointed based on their expertise and stature, as opposed to organizational affiliation.

Coordination Between the Advisory Council and the Forum

While the Advisory Council and the Forum could function independently of each other, the Commission intends that the two entities complement and support each other's work and believes that each will be strengthened by the other. For example, the Forum will endorse standardized measures of quality that address the Advisory Council's aims and objectives and will provide support to assure the reporting of those measures by the health care industry. The Forum thus serves as an agent for implementing the work of the Advisory Council. The Advisory Council also is charged with tracking progress in identifying and reporting core sets of quality measures used to monitor progress in meeting national aims and objectives.