Paying Physicians for High-Quality Care
http://www.100md.com
《新英格兰医药杂志》
The recent call from the Institute of Medicine for government payers to increase payments to health care providers who deliver high-quality care is one of several signs that practicing doctors can expect some fundamental changes in the way they are compensated.1,2 Health care insurers and purchasers in the private sector have begun moving along a similarly ambitious path.
Many physicians are already familiar with quality incentives from their experience with managed care; such incentives began as small payments for higher ratings of patient satisfaction or for the use of preventive services such as mammography.3 These incentives have become so prevalent that physicians are more likely to receive financial incentives for improving the quality of care or patient satisfaction than for controlling the use of services.4,5 Anecdotal information also suggests that the amount of money being used as an incentive is growing substantially. Perhaps the real harbinger is the National Health System in the United Kingdom, which has recently adopted a payment-for-performance initiative of unprecedented size and scope. Nearly a third of a general practitioner's income will depend on the practitioner's performance as defined by 130 quality indicators.6,7,8 In this article, we discuss payment-for-performance initiatives — their origins and goals, the challenges they present, and the strategies that payers might use to overcome the challenges most effectively.
Origins
Several factors account for the increased interest in financial rewards to physicians for providing care of high quality. Quality measurements and monitoring have become more sophisticated. Indicators are now available to assess the treatment of a broad array of chronic diseases (e.g., asthma and congestive heart failure) and the appropriate provision of preventive care. The most prominent quality report card, the Health Plan Employer Data and Information Set (HEDIS), published annually by the National Committee for Quality Assurance, reflects the quality of care patients are receiving in health plans that cover 75 percent of Americans enrolled in managed care.9
These national efforts to monitor the quality of care,10 as well as individual studies,11,12,13 have illuminated serious shortfalls in the quality of clinical care in many areas. At the same time, longitudinal data on HEDIS scores10 and other measures of quality nationally14 indicate that these measures can spur meaningful improvements through the introduction of systems that enhance the reliability of delivery of key interventions. Nonetheless, prior models of health care delivery and physicians' payment failed to prevent gaps in the quality of care, as described in two reports from the Institute of Medicine15,16 At this point, no one argues that past payment models are ideal.17,18
Improving the quality of care ultimately requires changes in the behavior of individual physicians, even if systems to improve the quality of care play an important role. Health plans, and to some extent purchasers, are therefore moving to payment models that focus on physicians' behavior. Because the assessment of performance is more accurate, and investment in systems less expensive, for larger groups of doctors, most of these efforts focus on large physician groups within managed-care plans, rather than on small group practices or individual physicians.
Goals and Rationale
The underlying goal of incorporating financial incentives for quality into physicians' payments is not simply to reward "good" physicians or punish "bad" ones. The goal is to change the status quo by stimulating both immediate and long-term improvements in performance. Existing models reflect a broad spectrum in terms of the size of incentives, performance targets, and their potential for creating structural change in the delivery system. Many programs are merely updated models of early managed-care efforts that tied better performance on a few discrete measures to higher payment. Indeed, for some plans and purchasers, such programs are simply a way to demonstrate concern about matters besides the cost of care. Today, however, the most aggressive programs are incorporating quality measures that will lead to redesigned systems (such as the use of disease registries) and large investments in information technology (such as electronic medical records).19
Complex goals characterize models that use financial incentives to provoke a redesign of systems and investments in information technology. Recognizing that few physician groups have made such changes,20 proponents of quality incentives see physician practices as trapped by rising costs and stagnant or even declining fees. Substantial financial incentives, for example, are required to justify the $10,000 to $20,000 per physician per year that is required to implement an electronic medical-record system.21 Thus, a core goal of the movement to reward quality is to create financial incentives that are large enough to motivate structural change. The impact of incentives on individual physician practices, of course, reflects both their size and the percentage of the patient population on the basis of which they are paid.
A related concept, and one that is highly controversial, is that the same system changes needed to achieve error reduction and improve other aspects of quality will reduce the cost and improve the efficiency of care. Interventions such as reminder systems, coupled with computerized decision support, will not only improve safety (by reducing medication errors and other mistakes) and the quality of care (by increasing the use of tests and treatments known to improve patient outcomes) but also save money by reducing the use of inappropriate drugs and tests and allow for the provision of care with fewer hospitalizations.
Another core concept is "population management." Proponents of incentive payments as a means of changing the infrastructure aim to stop frontline doctors from regarding their only job as caring for the sick patient before them. Proponents of population management hope that the financial rewards will be substantial enough to encourage physicians, or at least groups of physicians, to invest in tracking systems and also to direct staff resources toward issues flagged by these systems, thus broadening their delivery of care to the patient beyond the office visit.
Finally, some proponents of newer models hope that aligning incentives throughout the delivery system will put greater direct responsibility on physician practices to "get it right the first time." Currently, for example, insurers and carve-out companies analyze medical claims to determine which patients with diabetes have not had a glycosylated hemoglobin test. In the future, proponents hope that physicians' offices will have systems ensuring that all patients who need this test will have it, without the costs, delays, or errors introduced by analyzing claims data.
Prototypical Systems
The systems now being developed vary widely. The three programs described below illustrate the broad range of approaches currently in use or in development.
Bridges to Excellence
General Electric has been collaborating with Partners HealthCare, Tufts Health Plan, the Lahey Clinic, and other employers in Massachusetts to develop a quality program (Bridges to Excellence) that rewards physicians' offices with a bonus of up to $55 per patient per year if they have certain systems for improving care, such as registries, electronic medical records, care-coordination systems, and decision support. An additional reward of up to $100 per patient with diabetes will be paid to physicians who qualify for American Diabetes Association Provider Recognition. This program requires physicians to review 35 consecutive charts of patients with diabetes and meet standards regarding low-density lipoprotein levels, blood pressure, and control of levels of glycosylated hemoglobin. The program has been implemented by the National Committee for Quality Assurance, which audits 5 percent of the applications for accuracy.
The Integrated Healthcare Association's Physician Payment Program
The Integrated Healthcare Association (IHA) is a collaboration of six health plans in California that together provide care for 8 million enrollees. Under the IHA's Physician Payment Program, physician groups contracting with the six plans receive a consolidated performance scorecard covering three areas: clinical measures, patient ratings, and use of information technology. Clinical measures account for 50 percent of the total score and reflect performance on preventive care (mammograms, Papanicolaou smears, and childhood immunizations) and the quality of treatment for three chronic conditions (asthma, diabetes, and coronary artery disease). Patient-satisfaction ratings for patient–doctor communication, specialty care, timeliness of service, and overall satisfaction account for 40 percent of the score. Use of information technology accounts for the remaining 10 percent, with performance based on the group's ability to integrate data at the group level or provide individual doctors with data at the point of care.
Developing a coordinated plan has required extensive negotiation. The first incentive payments are planned for 2004. All six plans will use the same performance scorecards either as a single index or in concert with other quality indicators. Overall, it is estimated that up to $100 million will be available to the medical groups, but the specific incentive formulas have not yet been defined.
Anthem Blue Cross and Blue Shield Plan
Anthem Blue Cross and Blue Shield in New Hampshire launched its incentive program to improve quality in 1999. This plan does not include direct incentives for establishing a new practice infrastructure, but instead rewards physicians who provide certain preventive health care services linked with HEDIS measures, including breast-cancer screening, cervical-cancer screening, childhood immunizations, well-child examinations, and, for patients with diabetes, retinal examinations and lipid and glycosylated hemoglobin testing.
Physician practices that qualify for the award are paid an exact dollar amount for each patient receiving the targeted service in a given year. Physicians ranked in the top 25 percent of the network for a specific quality measure received $20 per year for each patient who received the service, and physicians in the third quartile received $10 per patient. In 2002, physician practices (with varying numbers of physicians) received up to $12,062 (for care given in 2001), with an average of $195 per practice. Thus, in most instances, the incentives for individual doctors were very small.
The Challenges Ahead for Purchasers and Physicians
However desirable it may be to align financial incentives with quality, various impediments complicate current strategies and pose new challenges for purchasers, insurers, and physicians. First, efforts to motivate doctors will have minimal effect unless the purchasers or insurers promoting incentive programs represent a substantial proportion of a physician's practice or unless different purchasers and insurers in the same geographic area coordinate programs. Under the program sponsored by General Electric, Bridges to Excellence, for example, if an internist has a panel, or patient base, of 2300 and this incentive program covers only 1 percent of the patients, then the physician would be eligible for only $1,265 in bonuses annually ($55x23). These funds would not be sufficient to support the system required to meet the bonus criteria. Larger group practices may be motivated by smaller payments because they can spread expenses among a larger number of physicians, but physicians are unlikely to respond to an incentive program that applies to less than 15 to 20 percent of their patient panel. Convincing consortiums of health plans and private and public purchasers to participate is thus critical, although difficult, since most insurers seek a competitive advantage by differentiating programs. The huge amount of effort expended in bringing the six collaborating health plans together under the IHA banner in California underscores both the magnitude of the task and its feasibility with a concerted effort.
Another challenge in designing and implementing these programs is getting the right mix of criteria for quality. Incentives based on a handful of measures of quality may encourage physicians to focus their efforts on improving quality in the areas targeted by the programs, neglecting other important aspects of care. In contrast, incentives based on too many measures may overwhelm physician practices.
Another consideration is that physicians may resist efforts to implement payment incentives for financial reasons. Medicare cut physicians' payments by nearly 5.4 percent in 2002 and held the increase in 2003 to 1.6 percent. With competition in the marketplace, the overall pool of money going to physicians from the private sector is also unlikely to increase substantially. Thus, bonus payments for physicians who achieve quality goals are likely to translate into lower base payments for those who do not achieve these goals.
Furthermore, payment-for-performance systems may unfairly penalize physicians caring for patients who are at a socioeconomic disadvantage and may motivate the physicians to reduce the number of patients for whom they provide care. Delivering high-quality care to patients in low socioeconomic brackets can be relatively difficult,22 and the physicians who serve them often receive less reimbursement and have less capital available for investment in new systems than do physicians providing care for patients in higher socioeconomic brackets. Rewards for quality could therefore help make the rich richer and the poor poorer. Although previous studies of access to care for severely ill patients have not revealed increased problems of access to services as a result of public measurement of health outcomes, diminished access remains an important concern.23 We know much less about risk-adjustment methods for the quality of care than we do about such methods for the cost of care.
Finally, financial incentives for performance may also threaten the sense of professionalism, autonomy, and job satisfaction among physicians, especially when purchasers make the rules and decisions that affect priorities in providing care. Previously, patients believed that their doctors would provide high-quality care as a matter of course. Will patients now worry when their doctors do not receive financial incentives for better quality? Some physicians are concerned that the very existence of new financial incentives based on performance may underscore the inadequacy of professionalism as a means of self-regulation and quality assurance.
Conclusions
New financial incentives for improvements in the quality of care represent a range of goals and ambition for the insurers and employers developing them. These efforts face important impediments and challenges; however, well-crafted payment-for-performance initiatives are worth pursuing and may lead to substantial improvements in the quality of care.
First and foremost, we need to expand efforts, substantially increase the size of incentives, and stay the course.17,18 Physicians are likely to respond to financial incentives if the dollar figures are large enough. This is a time when broad-scale experimentation would serve us well, although it must be coupled with evaluation and rapid dissemination of models that are effective.
Second, the impact of financial incentives depends critically on the efforts of large purchasers, such as the Center for Medicare and Medicaid Services, or collaborative efforts by health plans or purchasers, such as those in the IHA program. Individual purchasers or health plans with small market shares that implement their own programs may gain a marketing advantage, but they are unlikely to have a substantial effect on the quality of care if they act alone. Such efforts should not be confused with serious efforts to improve quality.
Third, directing financial incentives at a small number of individual indicators of clinical quality is unlikely to yield broad-scale improvement in the quality of care. Rotating measures and expanding over time the battery of performance indicators that are tied to financial payments will probably be more successful as strategies.
Fourth, the current systems for measuring quality are technically imperfect.24 Continued investment in systems for measuring and tracking quality in an affordable way remains important. Unfortunately, quality-incentive programs alone are unlikely to provide sufficient impetus for attaining the highest achievable quality of care. Programs to pay physicians for high quality should be combined with an array of other efforts to foster high-quality care, such as educational programs, computerized decision aids, and incentives for patients.
Finally, the most pragmatic hope for improving the quality of care lies in efforts that implicitly or explicitly call for investment in information infrastructure and the fundamental redesign of office practice. Realistically, this restructuring will be easiest to achieve in large physician practices with economies of scale and a natural grouping of physicians on which to measure performance. Additional strategies to improve the quality of care will be particularly important to pursue in solo and small-group practices.
References
Institute of Medicine. Leadership by example: coordinating government roles in improving health care quality. Washington, D.C.: National Academies Press, October 2002.
Pear R. Study tells U.S. to pay more for the best medical care. New York Times. October 31, 2002:A21.
Schoenbaum SC, Plotkin GR, eds. Quality assurance: a symposium. HMO Pract 1989;3:161-187.
Stoddard J, Grossman JM, Rudell L. Physicians more likely to face quality incentives than incentives that may restrain care. Issue brief no. 48. Washington, D.C.: Center for Studying Health System Change, January 2002.
Rosenthal MB, Frank RG, Buchanan JL, Epstein AM. Transmission of financial incentives to physicians by intermediary organizations in California. Health Aff (Millwood) 2002;21:197-205.
Shekelle P. New contract for general practitioners. BMJ 2003;326:457-458.
Gulland A. Negotiators go on the road to explain the proposed GP contract. BMJ 2003;326:519-519.
Marshall M, Roland M. The new contract: renaissance or requiem for general practice? Br J Gen Pract 2002;52:531-532.
Annual report of the national CAHPS benchmarking database 2000: what consumers say about the quality of their health plans and medical care. Rockville, Md.: Agency for Healthcare Research and Quality, September 2001. (Accessed January 5, 2004, at http://ncbd.cahps.org/pdf/ncbd2000AnRpt.pdf.)
The state of health care quality: 2002. Washington, D.C.: National Committee for Quality Assurance, 2002.
Chassin MR, Galvin RW. The urgent need to improve health care quality: Institute of Medicine National Roundtable on Health Care Quality. JAMA 1998;280:1000-1005.
Jencks SF, Cuerdon T, Burwen DR, et al. Quality of medical care delivered to Medicare beneficiaries: a profile at state and national levels. JAMA 2000;284:1670-1676.
McGlynn EA, Asch SM, Adams J, et al. The quality of health care delivered to adults in the United States. N Engl J Med 2003;348:2635-2645.
Jencks SF, Huff ED, Cuerdon T. Change in the quality of care delivered to Medicare beneficiaries, 1998-1999 to 2000-2001. JAMA 2003;289:305-312.
Kohn LT, Corrigan JM, Donaldson MS, eds. To err is human: building a safer health system. Washington, D.C.: National Academy Press, 2000.
Institute of Medicine. Crossing the quality chasm: a new health system for the 21st century. Washington, D.C.: National Academy Press, 2001.
Jencks S. The right care. N Engl J Med 2003;348:2251-2252.
Steinberg EP. Improving the quality of care -- can we practice what we preach? N Engl J Med 2003;348:2681-2683.
Bates DW, Gawande AA. Improving safety with information technology. N Engl J Med 2003;348:2526-2534.
Casolino L, Gillies RR, Shortell SM, et al. External incentives, information technology, and organized processes to improve health care quality for patients with chronic diseases. JAMA 2003;289:434-441.
Wang SJ, Middleton B, Prosser LA, et al. A cost-benefit analysis of electronic medical records in primary care. Am J Med 2003;114:397-403.
Zaslavsky AM, Hochheimer JN, Schneider EC, et al. Impact of sociodemographic case mix on the HEDIS measures of health plan quality. Med Care 2000;38:981-992.
Peterson E, DeLong E, Jollis J, Muhlbaier L, Mark D. The effects of New York's bypass surgery provider profiling on access to care and patient outcomes in the elderly. J Am Coll Cardiol 1998;32:993-999.
Landon BE, Normand SLT, Blumenthal D, Daley J. Physician clinical performance assessment. JAMA 2003;290:1183-1189.
Related Letters:
Paying Physicians for High-Quality Care
Gosfield A. G., Reinertsen J. L., Verdery R. B., Mahendran M., Graap R. F., Epstein A. M., Lee T. H., Hamel M. B.(Arnold M. Epstein, M.D., )
Many physicians are already familiar with quality incentives from their experience with managed care; such incentives began as small payments for higher ratings of patient satisfaction or for the use of preventive services such as mammography.3 These incentives have become so prevalent that physicians are more likely to receive financial incentives for improving the quality of care or patient satisfaction than for controlling the use of services.4,5 Anecdotal information also suggests that the amount of money being used as an incentive is growing substantially. Perhaps the real harbinger is the National Health System in the United Kingdom, which has recently adopted a payment-for-performance initiative of unprecedented size and scope. Nearly a third of a general practitioner's income will depend on the practitioner's performance as defined by 130 quality indicators.6,7,8 In this article, we discuss payment-for-performance initiatives — their origins and goals, the challenges they present, and the strategies that payers might use to overcome the challenges most effectively.
Origins
Several factors account for the increased interest in financial rewards to physicians for providing care of high quality. Quality measurements and monitoring have become more sophisticated. Indicators are now available to assess the treatment of a broad array of chronic diseases (e.g., asthma and congestive heart failure) and the appropriate provision of preventive care. The most prominent quality report card, the Health Plan Employer Data and Information Set (HEDIS), published annually by the National Committee for Quality Assurance, reflects the quality of care patients are receiving in health plans that cover 75 percent of Americans enrolled in managed care.9
These national efforts to monitor the quality of care,10 as well as individual studies,11,12,13 have illuminated serious shortfalls in the quality of clinical care in many areas. At the same time, longitudinal data on HEDIS scores10 and other measures of quality nationally14 indicate that these measures can spur meaningful improvements through the introduction of systems that enhance the reliability of delivery of key interventions. Nonetheless, prior models of health care delivery and physicians' payment failed to prevent gaps in the quality of care, as described in two reports from the Institute of Medicine15,16 At this point, no one argues that past payment models are ideal.17,18
Improving the quality of care ultimately requires changes in the behavior of individual physicians, even if systems to improve the quality of care play an important role. Health plans, and to some extent purchasers, are therefore moving to payment models that focus on physicians' behavior. Because the assessment of performance is more accurate, and investment in systems less expensive, for larger groups of doctors, most of these efforts focus on large physician groups within managed-care plans, rather than on small group practices or individual physicians.
Goals and Rationale
The underlying goal of incorporating financial incentives for quality into physicians' payments is not simply to reward "good" physicians or punish "bad" ones. The goal is to change the status quo by stimulating both immediate and long-term improvements in performance. Existing models reflect a broad spectrum in terms of the size of incentives, performance targets, and their potential for creating structural change in the delivery system. Many programs are merely updated models of early managed-care efforts that tied better performance on a few discrete measures to higher payment. Indeed, for some plans and purchasers, such programs are simply a way to demonstrate concern about matters besides the cost of care. Today, however, the most aggressive programs are incorporating quality measures that will lead to redesigned systems (such as the use of disease registries) and large investments in information technology (such as electronic medical records).19
Complex goals characterize models that use financial incentives to provoke a redesign of systems and investments in information technology. Recognizing that few physician groups have made such changes,20 proponents of quality incentives see physician practices as trapped by rising costs and stagnant or even declining fees. Substantial financial incentives, for example, are required to justify the $10,000 to $20,000 per physician per year that is required to implement an electronic medical-record system.21 Thus, a core goal of the movement to reward quality is to create financial incentives that are large enough to motivate structural change. The impact of incentives on individual physician practices, of course, reflects both their size and the percentage of the patient population on the basis of which they are paid.
A related concept, and one that is highly controversial, is that the same system changes needed to achieve error reduction and improve other aspects of quality will reduce the cost and improve the efficiency of care. Interventions such as reminder systems, coupled with computerized decision support, will not only improve safety (by reducing medication errors and other mistakes) and the quality of care (by increasing the use of tests and treatments known to improve patient outcomes) but also save money by reducing the use of inappropriate drugs and tests and allow for the provision of care with fewer hospitalizations.
Another core concept is "population management." Proponents of incentive payments as a means of changing the infrastructure aim to stop frontline doctors from regarding their only job as caring for the sick patient before them. Proponents of population management hope that the financial rewards will be substantial enough to encourage physicians, or at least groups of physicians, to invest in tracking systems and also to direct staff resources toward issues flagged by these systems, thus broadening their delivery of care to the patient beyond the office visit.
Finally, some proponents of newer models hope that aligning incentives throughout the delivery system will put greater direct responsibility on physician practices to "get it right the first time." Currently, for example, insurers and carve-out companies analyze medical claims to determine which patients with diabetes have not had a glycosylated hemoglobin test. In the future, proponents hope that physicians' offices will have systems ensuring that all patients who need this test will have it, without the costs, delays, or errors introduced by analyzing claims data.
Prototypical Systems
The systems now being developed vary widely. The three programs described below illustrate the broad range of approaches currently in use or in development.
Bridges to Excellence
General Electric has been collaborating with Partners HealthCare, Tufts Health Plan, the Lahey Clinic, and other employers in Massachusetts to develop a quality program (Bridges to Excellence) that rewards physicians' offices with a bonus of up to $55 per patient per year if they have certain systems for improving care, such as registries, electronic medical records, care-coordination systems, and decision support. An additional reward of up to $100 per patient with diabetes will be paid to physicians who qualify for American Diabetes Association Provider Recognition. This program requires physicians to review 35 consecutive charts of patients with diabetes and meet standards regarding low-density lipoprotein levels, blood pressure, and control of levels of glycosylated hemoglobin. The program has been implemented by the National Committee for Quality Assurance, which audits 5 percent of the applications for accuracy.
The Integrated Healthcare Association's Physician Payment Program
The Integrated Healthcare Association (IHA) is a collaboration of six health plans in California that together provide care for 8 million enrollees. Under the IHA's Physician Payment Program, physician groups contracting with the six plans receive a consolidated performance scorecard covering three areas: clinical measures, patient ratings, and use of information technology. Clinical measures account for 50 percent of the total score and reflect performance on preventive care (mammograms, Papanicolaou smears, and childhood immunizations) and the quality of treatment for three chronic conditions (asthma, diabetes, and coronary artery disease). Patient-satisfaction ratings for patient–doctor communication, specialty care, timeliness of service, and overall satisfaction account for 40 percent of the score. Use of information technology accounts for the remaining 10 percent, with performance based on the group's ability to integrate data at the group level or provide individual doctors with data at the point of care.
Developing a coordinated plan has required extensive negotiation. The first incentive payments are planned for 2004. All six plans will use the same performance scorecards either as a single index or in concert with other quality indicators. Overall, it is estimated that up to $100 million will be available to the medical groups, but the specific incentive formulas have not yet been defined.
Anthem Blue Cross and Blue Shield Plan
Anthem Blue Cross and Blue Shield in New Hampshire launched its incentive program to improve quality in 1999. This plan does not include direct incentives for establishing a new practice infrastructure, but instead rewards physicians who provide certain preventive health care services linked with HEDIS measures, including breast-cancer screening, cervical-cancer screening, childhood immunizations, well-child examinations, and, for patients with diabetes, retinal examinations and lipid and glycosylated hemoglobin testing.
Physician practices that qualify for the award are paid an exact dollar amount for each patient receiving the targeted service in a given year. Physicians ranked in the top 25 percent of the network for a specific quality measure received $20 per year for each patient who received the service, and physicians in the third quartile received $10 per patient. In 2002, physician practices (with varying numbers of physicians) received up to $12,062 (for care given in 2001), with an average of $195 per practice. Thus, in most instances, the incentives for individual doctors were very small.
The Challenges Ahead for Purchasers and Physicians
However desirable it may be to align financial incentives with quality, various impediments complicate current strategies and pose new challenges for purchasers, insurers, and physicians. First, efforts to motivate doctors will have minimal effect unless the purchasers or insurers promoting incentive programs represent a substantial proportion of a physician's practice or unless different purchasers and insurers in the same geographic area coordinate programs. Under the program sponsored by General Electric, Bridges to Excellence, for example, if an internist has a panel, or patient base, of 2300 and this incentive program covers only 1 percent of the patients, then the physician would be eligible for only $1,265 in bonuses annually ($55x23). These funds would not be sufficient to support the system required to meet the bonus criteria. Larger group practices may be motivated by smaller payments because they can spread expenses among a larger number of physicians, but physicians are unlikely to respond to an incentive program that applies to less than 15 to 20 percent of their patient panel. Convincing consortiums of health plans and private and public purchasers to participate is thus critical, although difficult, since most insurers seek a competitive advantage by differentiating programs. The huge amount of effort expended in bringing the six collaborating health plans together under the IHA banner in California underscores both the magnitude of the task and its feasibility with a concerted effort.
Another challenge in designing and implementing these programs is getting the right mix of criteria for quality. Incentives based on a handful of measures of quality may encourage physicians to focus their efforts on improving quality in the areas targeted by the programs, neglecting other important aspects of care. In contrast, incentives based on too many measures may overwhelm physician practices.
Another consideration is that physicians may resist efforts to implement payment incentives for financial reasons. Medicare cut physicians' payments by nearly 5.4 percent in 2002 and held the increase in 2003 to 1.6 percent. With competition in the marketplace, the overall pool of money going to physicians from the private sector is also unlikely to increase substantially. Thus, bonus payments for physicians who achieve quality goals are likely to translate into lower base payments for those who do not achieve these goals.
Furthermore, payment-for-performance systems may unfairly penalize physicians caring for patients who are at a socioeconomic disadvantage and may motivate the physicians to reduce the number of patients for whom they provide care. Delivering high-quality care to patients in low socioeconomic brackets can be relatively difficult,22 and the physicians who serve them often receive less reimbursement and have less capital available for investment in new systems than do physicians providing care for patients in higher socioeconomic brackets. Rewards for quality could therefore help make the rich richer and the poor poorer. Although previous studies of access to care for severely ill patients have not revealed increased problems of access to services as a result of public measurement of health outcomes, diminished access remains an important concern.23 We know much less about risk-adjustment methods for the quality of care than we do about such methods for the cost of care.
Finally, financial incentives for performance may also threaten the sense of professionalism, autonomy, and job satisfaction among physicians, especially when purchasers make the rules and decisions that affect priorities in providing care. Previously, patients believed that their doctors would provide high-quality care as a matter of course. Will patients now worry when their doctors do not receive financial incentives for better quality? Some physicians are concerned that the very existence of new financial incentives based on performance may underscore the inadequacy of professionalism as a means of self-regulation and quality assurance.
Conclusions
New financial incentives for improvements in the quality of care represent a range of goals and ambition for the insurers and employers developing them. These efforts face important impediments and challenges; however, well-crafted payment-for-performance initiatives are worth pursuing and may lead to substantial improvements in the quality of care.
First and foremost, we need to expand efforts, substantially increase the size of incentives, and stay the course.17,18 Physicians are likely to respond to financial incentives if the dollar figures are large enough. This is a time when broad-scale experimentation would serve us well, although it must be coupled with evaluation and rapid dissemination of models that are effective.
Second, the impact of financial incentives depends critically on the efforts of large purchasers, such as the Center for Medicare and Medicaid Services, or collaborative efforts by health plans or purchasers, such as those in the IHA program. Individual purchasers or health plans with small market shares that implement their own programs may gain a marketing advantage, but they are unlikely to have a substantial effect on the quality of care if they act alone. Such efforts should not be confused with serious efforts to improve quality.
Third, directing financial incentives at a small number of individual indicators of clinical quality is unlikely to yield broad-scale improvement in the quality of care. Rotating measures and expanding over time the battery of performance indicators that are tied to financial payments will probably be more successful as strategies.
Fourth, the current systems for measuring quality are technically imperfect.24 Continued investment in systems for measuring and tracking quality in an affordable way remains important. Unfortunately, quality-incentive programs alone are unlikely to provide sufficient impetus for attaining the highest achievable quality of care. Programs to pay physicians for high quality should be combined with an array of other efforts to foster high-quality care, such as educational programs, computerized decision aids, and incentives for patients.
Finally, the most pragmatic hope for improving the quality of care lies in efforts that implicitly or explicitly call for investment in information infrastructure and the fundamental redesign of office practice. Realistically, this restructuring will be easiest to achieve in large physician practices with economies of scale and a natural grouping of physicians on which to measure performance. Additional strategies to improve the quality of care will be particularly important to pursue in solo and small-group practices.
References
Institute of Medicine. Leadership by example: coordinating government roles in improving health care quality. Washington, D.C.: National Academies Press, October 2002.
Pear R. Study tells U.S. to pay more for the best medical care. New York Times. October 31, 2002:A21.
Schoenbaum SC, Plotkin GR, eds. Quality assurance: a symposium. HMO Pract 1989;3:161-187.
Stoddard J, Grossman JM, Rudell L. Physicians more likely to face quality incentives than incentives that may restrain care. Issue brief no. 48. Washington, D.C.: Center for Studying Health System Change, January 2002.
Rosenthal MB, Frank RG, Buchanan JL, Epstein AM. Transmission of financial incentives to physicians by intermediary organizations in California. Health Aff (Millwood) 2002;21:197-205.
Shekelle P. New contract for general practitioners. BMJ 2003;326:457-458.
Gulland A. Negotiators go on the road to explain the proposed GP contract. BMJ 2003;326:519-519.
Marshall M, Roland M. The new contract: renaissance or requiem for general practice? Br J Gen Pract 2002;52:531-532.
Annual report of the national CAHPS benchmarking database 2000: what consumers say about the quality of their health plans and medical care. Rockville, Md.: Agency for Healthcare Research and Quality, September 2001. (Accessed January 5, 2004, at http://ncbd.cahps.org/pdf/ncbd2000AnRpt.pdf.)
The state of health care quality: 2002. Washington, D.C.: National Committee for Quality Assurance, 2002.
Chassin MR, Galvin RW. The urgent need to improve health care quality: Institute of Medicine National Roundtable on Health Care Quality. JAMA 1998;280:1000-1005.
Jencks SF, Cuerdon T, Burwen DR, et al. Quality of medical care delivered to Medicare beneficiaries: a profile at state and national levels. JAMA 2000;284:1670-1676.
McGlynn EA, Asch SM, Adams J, et al. The quality of health care delivered to adults in the United States. N Engl J Med 2003;348:2635-2645.
Jencks SF, Huff ED, Cuerdon T. Change in the quality of care delivered to Medicare beneficiaries, 1998-1999 to 2000-2001. JAMA 2003;289:305-312.
Kohn LT, Corrigan JM, Donaldson MS, eds. To err is human: building a safer health system. Washington, D.C.: National Academy Press, 2000.
Institute of Medicine. Crossing the quality chasm: a new health system for the 21st century. Washington, D.C.: National Academy Press, 2001.
Jencks S. The right care. N Engl J Med 2003;348:2251-2252.
Steinberg EP. Improving the quality of care -- can we practice what we preach? N Engl J Med 2003;348:2681-2683.
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