Freedom of choice for specialized consultation in Portugal: an observational analysis of response to hospital quality

Background: Portugal introduced freedom of choice for initial specialist consultations in 2016 to boost quality via competition. However, for tangible benefits, specialized care demand must be quality-elastic. This research probes the relation between choosing hospital out the residence area and their quality traits. Methods: We used data for all primary consultation requests from primary care centres to hospitals from 1/1/2017 to 31/12/2018 (n = 3,346,335). We modelled the choice of a hospital as a function of its quality characteristics, adjusting for area-based socioeconomic variables using logistic regressions. Results: Results indicate that patients and their general practitioners consider quality indicators when choosing a hospital. Higher mortality, longer waiting times and higher readmission rates at the hospital of origin were positively associated with the patient's choice. Freedom of choice is less used when the distance to the hospital of origin increases. Similar patterns were observed for larger hospitals and those with academic status. Discussion: This study underscores the relevance of quality considerations in hospital selection by both patients and their general practitioners (GPs). The implications are two-fold. Firstly, improving quality appears as a factor to increase attractiveness, so that hospital competition may lead to improved health outcomes. Secondly, it highlights that hospital financing should include an activity dimension in which “money follows the patient”, otherwise no financial incentive exists to improve quality. Hence, the current hospital financing model and the limited possibility to choose in certain areas limit the potential of quality improvement based on enhanced attractivity. Decision makers should be aware that quality is a driver of patient choice, as our study demonstrates, and adapt the system to take advantage of this reality.