Informatics for Health and Social Care

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Health care development: integrating transaction cost theory with social support theory M. Nick Hajli, Mohana Shanmugam, Ali Hajli, Amir Hossein Khani & Yichuan Wang To cite this article: M. Nick Hajli, Mohana Shanmugam, Ali Hajli, Amir Hossein Khani & Yichuan Wang (2015) Health care development: integrating transaction cost theory with social support theory, Informatics for Health and Social Care, 40:4, 334-344, DOI: 10.3109/17538157.2014.924950 To link to this article: http://dx.doi.org/10.3109/17538157.2014.924950

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Inform Health Soc Care, 2015; 40(4): 334–344 ! Taylor & Francis Group, LLC ISSN: 1753-8157 print / 1753-8165 online DOI: 10.3109/17538157.2014.924950

Health care development: integrating transaction cost theory with social support theory

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M. Nick Hajli,1 Mohana Shanmugam,2 Ali Hajli,3 Amir Hossein Khani,4 and Yichuan Wang5 1

Department of Management, Birkbeck, University of London, London, UK, College of Information Technology, Department of Information Systems, Universiti Tenaga Nasional, Selangor, Malaysia, 3 Institute to Society and Culture, Sociology, Tehran, Iran, 4 University of Science and Culture, School of Engineering, Tehran, Iran, and 5 Department of Aviation and Supply Chain Management, Raymond J. Harbert College of Business, Auburn University, Auburn, AL, USA 2

The emergence of Web 2.0 technologies has already been influential in many industries, and Web 2.0 applications are now beginning to have an impact on health care. These new technologies offer a promising approach for shaping the future of modern health care, with the potential for opening up new opportunities for the health care industry as it struggles to deal with challenges including the need to cut costs, the increasing demand for health services and the increasing cost of medical technology. Social media such as social networking sites are attracting more individuals to online health communities, contributing to an increase in the productivity of modern health care and reducing transaction costs. This study therefore examines the potential effect of social technologies, particularly social media, on health care development by adopting a social support/transaction cost perspective. Viewed through the lens of Information Systems, social support and transaction cost theories indicate that social media, particularly online health communities, positively support health care development. The results show that individuals join online health communities to share and receive social support, and these social interactions provide both informational and emotional support. Keywords Health care, online communities, social media, social support, transaction cost, Web 2.0

INTRODUCTION Health care systems worldwide face major challenges due to the soaring demand for better services and more information. The rising cost of health care appears to be one of the major reasons why people resort to health-related websites on the internet (1). Many health sectors now take advantage of recent advances in e-health provision due to the significant reduction in costs and the resulting impact on national expenditure (2). E-health, the use of electronic

Correspondence: M. Nick Hajli, Department of Management, Birkbeck, University of London, London, UK. E-mail: [email protected]

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Integrating transaction cost theory with social support theory

tools in delivering health care (3), is rapidly emerging across the world. Besides gaining rapid acceptance, research reveals that e-health also improves user engagement and shows significant positive effects on many health conditions (4). People no longer have to depend entirely on doctors and health care centers to obtain first-hand information related to matters concerning their health. More and more people are coming online to pass on their knowledge and expertise, as well as to share and receive social support (5). Hajli (6) has reported that the engagement of patients in online platforms has been enhanced considerably by the emergence of Web 2.0 technologies. Whilst the internet remains one of the main drivers of e-health, the Web 2.0 phenomenon has had a major impact on health care, offering a wide range of activities and applications (7). These applications enable patients to have easy access to huge amounts of information related to health. It has been said that Web 2.0 technologies increase access to, enliven users’ experiences with, and enrich the quality of the information available online (8). As a result, Web 2.0 benefits both health professionals and patients by facilitating open access to information in order to share health-related ideas and questions through social support. Interestingly, these concepts have uncovered the tremendous potential for improving the quality and efficiency of health care systems (9), subsequently reducing both the transactional and medical costs. Patients are increasingly using Web 2.0 technologies such as social media to engage in social interactions with their peers in online communities (6). The ever-increasing demand for health care has led to the rapid acceptance of e-health support by many patients (10), and Web 2.0 continues to attract more individuals to online health communities. In principle, social media and Web 2.0 act as an alternative to modern health care in increasing the level of engagement and satisfaction of those participating in online health communities. With the popularization of the Internet and social media, people have equal access to health care professionals, and people who are connected within the same network are making massive use of this (11). These platforms also provide support for people dealing with stressful situations or when faced with difficult times. At the same time, this support eliminates additional transaction costs (12–15), which is one apparent reason for the high-medical costs that are a rising concern around the globe. This research explores the effect of Web 2.0 and social media on the health industry and how these technologies are influencing the development of modern health care. Related theories from social psychology are explored, along with the social support theory, transaction costs in the Web 2.0 platform from the perspective of both health care systems and social media. Investigating health care provision through this theoretical lens contributes to our understanding of the impact of this new technology on health care information systems.

RELATED WORK In this section, related work that establishes the theoretical foundation of this research is discussed.

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Social support Social support, a concept used extensively in both sociology and psychology, measures how an individual experiences the feeling of being cared for, responded to and facilitated by people in their social groups (16,17). Some authors have defined social support as an exchange of resources between at least two individuals, in this case a provider and a recipient, to enhance the well-being of the recipient (18). This support is expected to aid and relieve the deprivation of an individual and is thus presumed to ease that individual’s burden. With the recent emergence and popularity of social networks and online communities, social support has been found to be a major social value provided by the Internet to its users (19–21). Research has consistently indicated that social support is a self-reported measure of social resources that is theoretically derived from a social network (22). Retrospectively, the new platforms provided by social technologies have enabled people to receive social support from people or groups as a result of their frequent contact (23). In health care, social support has long been recognized as a protective factor against life stress and poor health (24). Online communities presumably seek social support from their stronger social ties prior to resorting to health care service providers during times of illness or when faced with difficult times (25). These supports encourage those experiencing emotional stress to cope and deal with these situations. Reports in the literature have demonstrated that finding effective ways to cope with physical and emotional stress is an essential factor supporting positive health outcomes (24). In related research, social support has been shown to function as a shield against major health problems among college students (26,27). Negative thoughts during a stressful situation and how people react to it may also be eased with social support (28). More specifically, by increasing the sources of social support for patients, health care systems will be able to improve positive patient outcomes (29). Social support can be seen as a multidimensional construct that consists of emotional, instrumental, information and appraisal supports (17). Emotional and informational supports are intangible in nature but both have been identified to be relevant in an online context (30). Informational support includes recommendations, advice, suggestions, directives or knowledge that could be helpful for solving problems, whereas emotional support refers to emotional concerns such as caring, understanding, love, trust or empathy (25,31). Transaction cost The theory of transaction cost was originally from economics by Coase in the late 1930s as part of his effort to develop a theoretical framework for predicting economic tasks, although Coase failed to provide an operational framework (32). This approach was later taken up by authors such as Williamson and Arrow, who turned the concept into a useful analytical tool (32). The concept of transaction cost has no widely accepted formal definition due to the remarkably few papers that have been published on this topic, but it is generally taken to refer to the cost of engaging in a commercial transaction and compensating for any market imperfections (33). In economics and allied disciplines, a transaction cost, which was previously known as a marketing cost (34), refers to the cost incurred in making an economic exchange.

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An example of this is the buying and selling of property which requires paying commission to a realtor for every successful transaction. In a health care environment, transaction cost is best referred to as the effort and energy involved in purchasing health care products, aside from paying the medical bills. Other examples of health care phenomena that involve transaction cost include searching for prescriptions, negotiating with general practitioners or pharmacists, and seeking health advice. The transaction cost theory quickly spreads to other disciplines, including finance, marketing, innovation, sociology, organizational studies, law and information systems, but has received relatively little attention from those conducting research on health care development. Transaction costs are known to shape economic organizations (34), and in the modern health care environment, the economic perspective has now become a key construct. A recent study on insurance administration estimated that in the US alone, transaction costs in physicians’ practices were as high as $31 billion a year (35) and continue to rise. In the US, health care costs make up approximately 18% of the nation’s GDP and this figure is rising, depressing wage growth (36). Health care costs have soared in recent years, but the Institute of Medicine (IOM) estimates that as much as 30% of these costs may be due to wasteful spending (36). These additional transaction costs mostly arise due to limited information and uncertainty about the future, among other reasons (12–15). With the emergence of the new generation of social technologies and what it can offer, the transaction costs incurred by the health care industry could be reduced significantly and thus improve the dire financial situation many of our health care systems find themselves in. The overall productivity of this sector can be enhanced by reducing the costs associated with transaction cost activities related to health care with the emergence of Web 2.0 technologies. E-health and Web 2.0 The emergence of Web 2.0 and the resulting empowerment of large sectors of the population through its social media applications have resulted in a demand for tremendous repositories of personal health information (7). Some individuals have argued that many aspects of Web 2.0 technologies, which include high-level interactivity, the capacity for deep user engagement, and extensive reach, make them an attractive and potentially effective channel for disseminating health information to consumers (37). In fact, statistics show that searching for health information online is increasingly common (38) and people resort to these information searches mostly for advice, which in return helps them save the time and cost incurred in visiting a doctor or health care centre. In the United States, more than one quarter of those Internet users dealing with major illnesses or medical problems reported that the Internet played a crucial role when making a decision (39). Another study found that between 60 and 80% of adults browse online for health information, which includes comments, ratings or reviews provided by both patients and health care providers who are consumers themselves (40,41). The Internet, as one of the main drivers of e-health, offers significant advantages to its users via a variety of initiatives. For example, many free sites allow Internet users to rate their doctors (www.ratemds.com), express a public opinion about their health care system (www.patientopinion.org.uk) or share

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their experiences about their own illnesses (www.patientslikeme.com) (6). It is, however, crucial to note that by nature, health care is community orientated (42), and therefore Web 2.0 is mainly valuable in facilitating social interactions and there is a need to incorporate Web 2.0 tools into the context of health care development. Additionally, the literature suggests that Web 2.0 has the potential to build social support for those affected by health care issues (43), which is often absent in a traditional health care system. To some extent, Web 2.0 technologies encourage a less passive viewing of information and increased user participation, which is particularly apparent within open contribution sites (44) such as wikis, podcasts and blogs. A report by the Epsilon Company indicates that individuals use social networking and Web 2.0 health applications not only to learn about treatment options but also to feel comforted by knowing they are not alone. The ability to find answers from other patients suffering from similar ailments supports self-engagement in the management of their individual health concerns (45). More specifically, the growth of Web 2.0 health applications has opened up more opportunities for social interaction as it facilitates and encourages users to find, use, create and share content with each other (46).

METHODOLOGY This section describes the methodology used in this study, including the research method and the data collection procedure, and discusses the trustworthiness of the study findings. Research method This study followed an empirical qualitative research approach. Its primary aim was to develop a rich understanding of the problem through the use of a qualitative framework (47,48). This type of qualitative research is known to be a suitable methodology for studies of information systems (49). Primary data were collected through interviews, which provide a good qualitative approach that produces data which facilitate the identification of themes and patterns during the data analysis (50). Qualitative research has been shown to produce data that can help researchers to interpret these patterns as long as quality criteria such as reliability and validity have been considered during the research process (51). Data collection Data were collected using a semi-structured interview format either over the telephone or face-to-face. Interviews lasted an average of half an hour. Participants were selected through convenience sampling. Choosing a study sampling approach is particularly important in qualitative research (52), and the goal of this research was to ensure the study sample was indeed representative of the target population. Therefore, the questionnaire began with a filter question, either ‘‘Are you a member of any online health communities?’’ or ‘‘Are you using social media to gain access to health-related information?’’ These filter questions helped ensure suitable study participants for our research. 200 UK residents were invited to participate in this research; of these, 55 individuals were eligible for this study, a response rate of 27.5%.

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The remainder either did not choose to participate in the research or were not active in any online health communities. All the study participants lived in London; 65% were female and 35% were male, and all were between 28 and 56 years of age. Study participants were recruited through local surgeries, hospitals, dentists and local walk-in centres. Participants were informed that their conversation may be used in our research, and the work would be published in an academic journal and assured that complete anonymity would be maintained. Before participants were recruited, ethical approval was obtained from the UK National Health Service (NHS), the London Comprehensive Local Research Network (CLRN) and staff at the health centers where the recruitment took place. Participants were also encouraged to contribute and support the research, and several were invited to check our coding process and the interpretation of data. The aim was to achieve external validity, as discussed in detail later in this section. Data analysis Data were collected through a semi-structured interview and content analysis applied for the data analysis. Content analysis is a qualitative technique that utilizes a systematic description of content (53). Choosing a unit of analysis is the first step of a content analysis (54), which here was the use of social media such as online communities and YouTube to acquire health-related information. After each interview, the recordings were processed to categorize the data to enable the authors to generate the codes and patterns. The transcripts were coded independently by three researchers, after which an adjudicator assessed the results and resolved any disagreements. A major issue in content analysis is the trustworthiness of data, which will be discussed in the next section in order to generalize the results. Reliability and validity In qualitative research, the reliability and validity of the research together is a key issue (55). Throughout the process of data collection and content analysis, the trustworthiness of the research was an important factor. For example, a text may be interpreted differently by different coders (54), so an independent judge was asked to check the process of coding. The level of agreement was high and inter-coder reliability was confirmed (56). The judge also commented on categories, as did several of the participants who assisted us in checking the patterns reported below in ‘‘Findings’’ Section.

FINDINGS This qualitative research study was conducted to investigate the role of social media in developing modern health care. The primary goal was to address the following questions:  

Why do people use online health communities? Which factors may persuade people to use online health communities?

The results of the content analysis revealed that the participants joined online health communities to share and receive social support. Participants

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went online to discuss issues related to their health, in some cases to share their knowledge, information and experiences with their peers in the online health communities. These social interactions the study participants engaged in through the online health communities provided them with informational support and emotional supports, both of which represent intangible sources of social support. The results of this study show that participants feel they can obtain healthrelated information from their peers in the online health communities. One participant commented ‘‘when I need some health-related information, I go to my online health community and ask my questions. After a few days, and sometimes in few hours, . . . [someone will] answer my questions.’’ This is a sign of informational support, a main factor of social support. Another participant said ‘‘I like to share my knowledge and experiences with other diabetics. I am a diabetic and I feel good when I go to my favourite health community and support them.’’ Sharing information and experiences with peers is another dimension of informational support. Emotional support is another valuable social support that is readily available in online health communities, as demonstrated by one participant who explained it as follows, ‘‘Sometimes, it is really a matter of support and when you discuss it with other people you feel better. When I do not feel good and need support, I go to my online community, and ask peers to comment on my problem.’’ This immediate access to both informational and emotional supports is the main reason participants join online health communities, thus answering the first research question. To some extent, it also addresses part of the second research question, which asks about the factors persuading people to use online health communities. The results of this study show that participants join and use online health communities not only because of the supportive climate developed by social media, but also due to the health information they need and receive online. This helps them avoid the transactional cost of seeing a doctor and hence also saves medical costs for the health care system. Participants saved both time and money by using online health communities and social media. One particular participant described how they found their online health community helpful: ‘‘Sometimes, I need to see my doctor for issues related to my recent problem [with my] leg . . . I found a good online community related to physiotherapy which I checked . . . with my doctor. I now use this interactive environment [YouTube], which saves my time and money from having to visit the physiotherapist [as often].’’ The results of this research show that saving time and money, along with the supportive climate in online health communities, persuaded participants to use social media and online health communities to enhance the health care they were receiving. In addition, social media with its interactive and smart features attract participants to Web 2.0 technologies. The results show that participants enjoy using social media such as YouTube to watch health-related clips. Several participants mentioned various features of health care through social media. For instance, one study participant said: ‘‘It is a great opportunity to join an online community developed by [the] government where information is trustworthy. I ask my questions there, and they sometimes refer me to YouTube to watch a clip related to my issue, a feature which I really like most. Why should I take off and go to a doctor, when I can

Integrating transaction cost theory with social support theory

seek help online?’’ This participant and more than 20 others emphasized that Web 2.0 technologies such as YouTube supported the traditional health care provision as it gives users immediate access to health information and provides good support from peers who are dealing with similar issues.

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DISCUSSION AND CONCLUSIONS Empowered by Web 2.0 and social media, individuals are now able to create content and share their information and experiences with their peers in online communities. People join online health communities because of the attractive features these communities offer. They share their health-related information and experiences with other members of the community who are seeking information. Individuals can both ask questions in online health communities and seek information. These supportive environments produce informational and emotional supports. Sharing and seeking health-related information produces social support within these social networks, which increasingly attracts individuals to join and benefit from a community’s social support network. This is largely due to the nature of social media, which attracts people to online communities every day. These communities not only offer social support but also save time and money for their members. Individuals may obtain the health information they need through online communities, saving them both time and money. This is also leading to the development of new health care approaches using Web 2.0 technologies and social media to improve the daily lives of individuals. Therefore, the use of Web 2.0 and social media in developing online health communities may provide alternative avenues for improving health care provision. The health industry continues to face challenges due to cost cutting policies, increasing demand for health services and the increasing cost of providing health services. As such, this sector may benefit by supporting online health communities and encouraging more people to join these communities instead of going to their doctors for at least some issues that can be fulfilled through these communities. Like other studies, this research suffers from a number of shortcomings. First, the study enrolled only 55 participants. Future research in this area would benefit from working with a larger sample. Second, the research collected data in the UK. Other countries may have different cultures in their online health communities and they are likely to operate in different health care contexts. This reduces the generalizability of our results. Therefore, future research could apply the same theoretical lens and collect more data in a different geographical context and compare the results.

DECLARATION OF INTEREST The authors report no conflicts of interest. The authors alone are responsible for the content and writing of this article.

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Health care development: integrating transaction cost theory with social support theory.

The emergence of Web 2.0 technologies has already been influential in many industries, and Web 2.0 applications are now beginning to have an impact on...
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