A study of Lansing hospitals by the area's Big Three employers shows Michigan Capital Healthcare to be the ``best performing hospital overall.''

The study - intended to help General Motors, Michigan State University and the state of Michigan find the best medical care for the buck - shows Michigan Capital provided care at a lower cost than its competitors.

In terms of quality, all of the hospitals performed better than the benchmark used in the study.

Hospital rated as the best: Dr. Divyakant Gandhi (left) and Dr. Richard Beshore perform a coronary artery bypass graft on an open-heart surgery patient Wednesday at Michigan Capital Medical Center's Greenlawn campus.

``The people of this community should be very happy with the fact they're getting high quality health care,'' said Keith Groty, who is in charge of human resources for Michigan State University. ``Our concern is how much does quality cost.''

The report has become a source of controversy for Lansing's hospitals, which have criticized how it was put together and its findings.

``It's a step backward,'' said Sparrow spokesman Joe Wald. ``It's just not reliable. The release of bad data is probably even less preferable than the release of no data.''

The hospitals' greatest criticism:

The study used data taken from the 1994 insurance claims of the three employers' combined 100,000-plus workers, dependents and retirees.

Claims information, the hospitals say, is less reliable than patient chart data and doesn't take into account existing medical conditions or other socio-economic factors that also determine costs and how fast a patient recovers.

The employers agree patient charts are the best source of information, but they say claims data is a second-best choice and that such information can also be adjusted to take into account other factors.

In addition, claims data was the only information available, they say. As purchasers of health care, they say that for nearly a decade they have asked for and been denied access to patient data through the hospitals.´ ``We do believe the study accurately shows that in 1994, there was a significant difference between Sparrow and MC-squared in cost,'' said Groty. ``Sparrow is working at it and that is coming down, but we believe there is still more that can be done.''

The three employers commissioned the study more than a year ago. All are under mounting pressures to hold down rising health- care costs - amid drives to balance the state's budget, slow tuition increases or stay competitive.

Ann Arbor-based MedStat Group, a medical economics company, took the information, broke it down, adjusted it for severity of cases handled at the different hospitals and then compared it to a benchmark set by top Southeast Michigan hospitals.

Some of the study's findings indicate that in 1994:

Total payments per case for all admissions: Michigan Capital was the only Lansing hospital less expensive than the benchmark. Michigan Capital was 5 percent less. St. Lawrence, 9 percent higher. Sparrow, 15 percent higher.

Complication-of-care ratios for all admissions: All three Lansing hospitals were below the risk-adjusted benchmark. Michigan Capital fared best, followed by Sparrow and then St. Lawrence.

Total payments per case for surgical admissions only: Michigan Capital's were 6 percent cheaper than the benchmark. St. Lawrence's were 9 percent more expensive than the benchmark, while Sparrow's were 13 percent higher.

Total payments per case for maternity admissions: Michigan Capital 12 percent less expensive than the benchmark. St. Lawrence's was 18 percent higher and Sparrow was 23 percent higher.

C-Section rates: All three hospitals were above the national benchmark of 15 percent of all deliveries. Michigan Capital's rate was 19 percent. St. Lawrence, 24 percent. Sparrow, 28 percent.

The study was turned over to the hospitals for their input in March and set for release in April. But an eleventh-hour appeal from the hospitals and their promise to turn over patient data for a replacement study pre-empted its release.

``Insurance data at best is accurate some 50 to 70 percent,'' Wald said, adding there had been a written agreement between the hospitals and the employers not to release the report.

In addition to the use of claims data, the study contained other flaws in the benchmarking process and in how they determined what constituted a complication in care. For example, Wald said, the study classified self-induced drug overdoses that arrived at the emergency room as complications.

``The chart data we're all working on is shown to be better than 90 percent accurate,'' he said.

But others, including the employers, expect the second study will show a similar trend.

``I don't think you'll see a huge change ... on the cost side,'' said Dennis Litos, Michigan Capital president and chief executive officer. ``On the quality side, it will probably improve the outlook, and you might see that turn around a little bit.''

Michigan Capital currently is negotiating the sale of most of its assets to Columbia/HCA, the nation's largest for-profit healthcare chain. Michigan Capital says the sale - or a possible partnership - would hold down medical costs and improve care. Critics of the potential deals question those claims.

St. Lawrence officials could not be reached for comment Wednesday afternoon or evening.

The second study was to be launched and completed by early summer.

Some six months later, the hospitals have installed or are in the process of installing the computer software to gather the data.

But they have yet to decide how it will be compiled or just what will be released and whether any of it will reach the public, Groty said.

Still, the employers are determined to see the report's completion.

The state contributed $30,000 toward the report released Wednesday and taxpayers deserve to see its results, said Dennis Schornack, who heads the state's health-care initiatives. The report was released to the Lansing State Journal after the newspaper requested it under the Freedom of Information Act.

The total cost is estimated at more than $75,000.

It's just the kind of information needed, some consumers say.

``You really don't get that kind of information anywhere,'' said Rita Bunton, 47, a Lansing resident and public relations director for Olivet College. ``In this day and age people are pinching pennies, and they need to know where they're going to get their best buy.''

But Bunton added, ``it's not just the money.''

She herself was treated at Sparrow for a stroke, and was pleased.

``The people, their attitudes, the overall quality of the institution itself; if it's clean, money is just one aspect.

``It would take a lot for me to change.''

Other consumers disagree over how valuable such data could be.

``It's helpful ... but I think it's more important to go where the doctor that's helping you is,'' said Abe Takahashi, a retired Perry resident. ``That's the first choice.''

Staff reporter Margarita Bauza contributed to this report.
Photo: ROD SANFORD/Lansing State Journal