Does patient trust promote better care?

Information asymmetries favouring the supplier in the production of good health have long been acknowledged as an anomaly in medical markets creating the potential for inefficiency. Such asymmetries may undermine the physician/patient relationship. And given these asymmetries, patient trust may play an important role in successful physician/patient relationships. This agency relationship has been studied for many years in the context of Fee-for-Service (FFS) reimbursement. But the market has changed considerably given the combination of an influx of information and the penetration of managed care - both of which have shifted some decision-making power away from the physician. An additional important factor in the physician/agency relationship that is also changing is patient trust. Where patient trust was implicit in the system with predicted positive effects on health outcomes when FFS was the norm, now trust itself is not a given, and its effect on the doctor-patient relationship may be evolving. We study how trust impacts patients' perceptions about quality of care, and whether these relationships differ by health insurance type. We find that Health Maintenance Organization (HMO) patients have significantly lower trust in their primary care physicians than those with more traditional coverage. Using a multi-dimensional index of patients' perceptions about the quality of care they receive from their physicians, we also find that trust has no significant effect on perceived quality for non-HMO patients, but significantly improves perceived outcomes for HMO patients. We conclude that trusting patients are more likely to have a better doctor-patient relationship than those who are skeptical in the HMO setting. Perhaps given lack of provider choice, it requires a level of trust in general to be compliant and satisfied with assigned physicians. In the non-HMO setting where consumers are now armed with more information and free to make choices, trust becomes less important. These results have implications for how decisions are made in the market for health services we face today and ultimately for public health policy.