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Although the Pennsylvania Health Care Cost Containment Council's fourth-floor offices at 225 Market St., Harrisburg, may be cramped, they hold a massive data collection and processing operation.

Every year, the council's 53 employees analyze millions of pieces of data, measuring everything from hospital revenues to surgical complication rates.

Given the sensitive nature of the information and how negative data such as falling revenues or increased mortality rates could affect the public's perception, of the health care system, hospitals and other health care organizations often criticize the council's findings.

Despite the sometimes tense relationship between the council and health care groups, both sides said they are working to find common ground.

Rocky start

Created by the General Assembly in 1986 as an independent state agency, the council collects and analyzes financial data, as well as quality performance data, from hospitals, doctors and managed-care plans statewide. The council publishes about six reports a year on its findings. These reports are free to the public.

Marc Volavka, who became its executive director in 1998, said many of the council's initial reports came under fire from the hospital community in the late 1980s and early 1990s.

Hospitals complained that the council's early reports used old data and estimates rather than current statistics to measure the cost and quality of health care, according to a Philadelphia Daily News article published in 1991. The Pennsylvania Medical Society, Lower Paxton Township, lobbied to get rid of the council in the early 1990s.

"The first two or three reports (the council) put out were highly controversial," Volavka explained. "When we put a report out and a local newspaper puts a headline that says 'hospitals kill people,' hospitals don't like that."

And while criticism of the council's data has not disappeared, both Volavka and representatives of area health care organizations said the relationship between the council and providers has become more productive.

For example, 60 percent of those who use the council's data represent hospitals, doctors and managed-care plans, according to Volavka.

"At first, doctors were sort of alarmed that performance and financial data was going to be available," said Bernie Lynch, director of medical economics for the Pennsylvania Medical Society. "But thee information (put out by the council) cannot be ignored. Ignorance is not bliss."

How it started

In 1986, two opposing forces - business and labor came together to fight a common foe: rising health care costs.

After several failed attempts to solve the problem on their own, business and labor groups asked the state to step in. Although some legislators suggested government price controls on health care products, a free-market approach instead guided the formation of the council.

"The concept was that (business and labor groups) would have information available to them where they could look at the quality and cost of health care and make their own choices about where they wanted to buy their health care," Volavka explained. "So the purchasers wanted to have a better idea of where they should buy their health care."

Today, the council's publicly available reports include:

* a report on hospital finances, including net patient revenue, total margins and operating margins;

* a report on hospital quality, including risk-adjusted mortality rates, risk-adjusted average lengths of stay, and average hospital charges; and

* an HMO-quality report measuring clinical results, preventive measures and member satisfaction information.

The council also sells customized reports and raw data to groups such as researchers and health care organizations. These reports cost from $200 to several thousand dollars," said Volavka. The council sells about 50 customized reports and 200 data sets per year.

The council receives about $3.8 million in annual state funding, but also makes about $700,000 through the sale of its data, Volavka said. Increases in state funding and in outside sales have boosted total revenue for the council from $2.7 million to $4.5 million over the past four years.

Under state law, hospitals have 90 days and managedcare plans have six months after the close of a quarter to provide data to the council. If the data is not provided in time, health care organizations may face fines of up to $10,000 a day, Volavka said. However, no one has ever been fined, he added.

Volavka said most organizations comply with the council's requests. for information.

Tension

Still, tensions remain. In late April, the council released a preview of its hospital financial report for FY 2000 and reported that net income for the state's hospitals more than doubled, from $295 million to $608 million.

The Hospital and Healthsystem Association of Pennsylvania in Swatara Township, which has voiced concerns over hospitals' financial struggles, responded with a press release expressing "strong reservations about the precision and usefulness" of the report.

"Even when viewed in a favorable light, this report is misleading," association president and CEO Carolyn Scanlan said in the release. "It gives policy-makers and the public the impression that, overall, hospitals are in good fiscal health - when precisely the opposite is the case."

Martin Ciccocioppo, the association's vice president of research, carefully chose his words when asked about the association's relationship with the council.

"The council's role in gathering information is important," Ciccocioppo said. "But we have some concerns about the council's methodology and agenda."

For example, the Hospital and Healthsystem Association "knew nothing about" the council's financial preview until it was released to the public on April 25, he claimed.

Ciccocioppo also questioned the validity of some council data.

Consumers should not base their health care choices solely on the council's information, added Amy Fink, spokeswoman for Memorial Hospital in Spring Garden Township.

"You can't really compare hospital to hospital, because there's different reporting criteria for differentsized hospitals," Fink said. For example, some hospitals split functions to other companies that don't have to report to the council. "The council, in our minds, is there to collect data and redistribute it to the community, but sometimes they try to interpret that data, and I don't know if that's its mission."

But Lynch said the Pennsylvania Medical Society was able to create a better working relationship with the council by voicing some of its concerns about the accuracy of the data.

Even Ciccocioppo admitted that working with the council can have positive results. Despite its reservations about some of the council's data, the association has increased its efforts to get hospitals to give data to the council in a timely manner.

"Now there's much greater compliance among hospitals sending in information to the council," he said. "That's a result of the council and (the association) working together."

Getting the word out

As it works to improve its relationship with health care providers, the council must also make the public more aware of the information the council provides, said Jim Godfrey, president of HealthGuard and a council member.

"Our goal is to attract more public interest," Godfrey said. "There's so much information out there, but we have to get the word out about it."

Godfrey said the council is making efforts to make its reports more readable and understandable to health care consurners.

For more information visit the website at www.phc4.org.