Finally, the Kitsap, Washington program has generated savings of 5 percent of total cost. 1, 2 In one, a $25 premium was introduced for primary care physicians who saw patients within two weeks of hospital discharge. The impact of removing financial incentives from clinical quality indicators: Longitudinal analysis of four Kaiser Permanente indicators. The Case for Capitation - Harvard Business Review Financial Incentives - PMC - National Center for Biotechnology Information In the Philadelphia program, no hospital savings are being returned to physicians. Two studies by our colleague and a leader in this field, Kevin Volpp, have shown impressive results. Consider, for instance, a physician whose expected expenditure equals the capitation payment and who has 100 patients in the panel. Secondarily, the article summarizes the available evidence on whether physicians have cut costs in response to these incentives. In this article, the risk arrangements in Medicaid programs that put physicians at risk are summarized. [Nancy Harrison] Who qualifies for Medicare's hospice benefit? Payments are provided annually based on the number of points a practice earns for meeting predetermined quality goals. government site. Payments are accumulated and sent out monthly. Additionally, the heterogeneity of P4P programs, the voluntary nature of many programs, and the lack of high quality studies limits rigorous evaluation. If the participant does not call in or the morning glucose is out of range, then the participant is still entered into the lottery but does not receive payment. Is it acceptable for people to be paid to adhere to medication? The outcome metrics were HbA1c 7.4% and BP 140/85mmHg within the past 15 months, and a total serum cholesterol 190 mg/dL ( 5 mmol/l) within the past five years [12]. This pooling solves the problem of small numbers. Authors' Conclusions: The use of financial incentives to reward primary care physicians for improving the quality of primary health care services is growing. To calculate savings, the Medicaid program projects what fee-for-service costs would have been for a PCP's enrollees, adjusting for actuarial characteristics such as age and sex. There are an average two PCPs per risk pool. (Needless to say, the issues of access and quality of care are important but beyond the scope of this article.) As in Oregon, a capitation payment in California covers all physician services and there is no withhold. In Philadelphia, a private entity was put at risk. The structure and reimbursement plans of P4P programs in the US differ widely, limiting comparisons between them, but potentially allowing for greater insights into how to more optimally design future programs. Given its deficit and its budget relative to FFS, the program does not appear to be cutting costs. Whereas Medicare's VPS is defined in terms of growth of expenditure, the PCP's standard is in terms of level of expenditure. Johnson EJ, Goldstein D. Do defaults save lives? Monterey's risk arrangement was poorly designed and did not survive. Interestingly smokers were more likely than non-smokers to endorse using financial incentives for tobacco cessation and obese people were more likely than non-obese people to support incentives for weight loss. Of the law's several components, by far the most visible has been the attempt to prioritize health care services. In addition, Itasca. The PCO retains any surplus and is at risk for any deficit. Doctor's Decisions and the Cost of Medical Care. The program is intended to be budget-neutral, meaning that groups with performance below the national mean will be subject to downward adjustment. ), The HIO to which the State's risk is transferred can take several legal forms. I have excluded five programs from those listed in Tables 1 and and2.2. Savings of hospital costs are split 50-50 between the physician and the HIO, but no physician receives hospital savings unless there are savings for physicians as a group. The ClinicalTrials.gov website indicates several active studies employing incentives for a variety of health outcomes including medication adherence, tobacco cessation, healthy lifestyles, and diabetes-specific health behaviors. In a second study reported at the 2012 Society for General Internal Medicine National Meeting overweight hospital employees were randomized to: 1. monthly weigh-ins alone; 2. The commentary here captures the distinguishing features.6. The program declared bankruptcy 20 months after its creation. Issues in pay for performance: The case of diabetes self-management. The fees were increased slightly from fee-for-service Medicaid, there was no withhold, and the PCP was not even at risk for his or her own services. In particular, none of the studies addressed issues of selection bias as a result of the ability of primary care physicians to select into or out of the incentive scheme or health plan. Kullgren JT, Loewenstein G, Troxel AB, et al. Financial incentives for patients are even more controversial. Dr. Thomas H. Lee explores what is most effective in regard to engaging and motivating physicians. Doran T, Fullwood C, Gravelle H, et al. [Accessed October 2nd, 2012]; Ethical considerations for the use of patient incentives to promote personal responsibility for health: West Virginia medicaid and beyond. Surpluses and deficits, however, are shared quite differently in the two programs. The incentive to underutilize may be excessive (Physician Payment Review Commission, 1989). Although this proportion cannot be measured directly, it can be estimated, given that the United States has 950 persons per PCP. Kosterlitz J. Oregon wants a little Medicaid slack. physicians receive more money by performing more services. IPA is individual practice association. The next section describes the main features of seven Medicaid programs that give physicians incentives to control costs, particularly of physician services. P4Q schemes can reward desired outcomes, processes and structures . Physicians also receive part of the savings from reduced hospitalization. In April 2004, the United Kingdom (UK) started an ambitious P4P program, the Quality of Outcomes Framework (QOF). HIOs usually incorporate partial capitation to control primary care physician services; partial capitated programs usually share hospital savings with their physicians. Bariatric surgery versus intensive medical therapy in obese patients with diabetes. (Per diems are the same for all hospitals.) The most basic question of this article is whether these programs that put physicians at risk saved any money. The presumption is that the first services to be cut will be either unnecessary or of marginal value, and that the cap becomes effective in time to prevent cuts that jeopardize quality. In the ongoing study ({"type":"clinical-trial","attrs":{"text":"NCT01125969","term_id":"NCT01125969"}}NCT01125969) diabetes participants with persistently poor glycemic control are randomly assigned to 1. usual care, 2. peer mentors, 3. financial incentives, or 4. peer mentors and financial incentives. PCPs, as individuals or groups, receive a capitation payment for primary care services. If the reported values are between 80 and 140 mg/dl the participant is entered into a daily lottery and has a 1/10 chance of receiving $10 and a 1/100 chance of receiving $100. Contractors have received one-half of a sizable surplus, estimated at 41 percent of hospital costs. The National Institute for Clinical Excellence (NICE) estimates that the QOF costs the National Health Service (NHS) about 1bn per year in England, or 15% of the primary care budget. 7California has several problems: Enrollment is voluntary, it potentially has biased selection, making estimation of savings difficult. Non-Financial Provider Incentives: Looking Beyond Provider Payment There were also decreased diabetes-specific hospitalizations during this time. The second study, also using a pre-post design, was able to modestly increase SMBG using an App that enabled teens to earn experience points for SMBG testing which could then be redeemed for Apple iTunes purchases [32]. Physicians also receive part of the savings from reduced hospitalization. Future studies will need to address this important issue. Aggregating all physicians' surpluses and deficits, there is a surplus equal to 9 percent of the specialty care budget. In 201213 each point is valued at 133.76. Three hospitals received most of their withhold back, and the other two received surpluses. Citicare, Kentucky, is excluded because of lack of information. The .gov means its official. Pay for perfomance and the quality of diabetes management in individuals with and without co-morbid medical conditions. 2. These summaries have been derived from Cochrane reviews published in the Cochrane Database of Systematic Reviews in the Cochrane Library. Physicians are formed into risk pools called pools of doctors (PODs). However, even in cases where an employer is prepared to pay as much as 50% of the monthly premium, low-income earners . Pay for performance in commercial HMOs. To avoid putting physicians at excessive risk, several Medicaid programs have enrollment thresholds, below which physicians are not at risk for hospital services. In sum, these programs suggest that putting physicians at risk can help contain health care costs. The leaders of a major insurance company have noted that rates of cervical cancer screening, mammography, and smoking cessation counseling in your practice are below national averages. The package always includes the primary care physician's own services and usually outpatient lab and X-ray tests. The Problem. Asymmetric paternalism to improve health behaviors. Effects of paying physicians based on their relative performance for quality. The State pays PCOs without a withhold, and PCOs pay specialists directly. The next section of this article focuses on potential program design issues and problems with these Medicaid programs. Rich. Three of the studies evaluated single-threshold target payments; one examined a fixed fee per patient achieving a specified outcome; one study evaluated payments based on the relative ranking of medical groups' performance (tournament-based pay); one study examined a mix of tournament-based pay and threshold payments; and one study evaluated changing from a blended-payments scheme to salaried payment. Early experience with pay-for-performance: From concept to practice. In contrast, Rosenthal et al found no difference in improvement in HbA1c screening compared to a control group in the Pacific Northwest after initiation of a Californian P4P group-reimbursement program [24]. If cheating turns out to be an issue, future interventions can use Bluetooth enabled glucometers which transmit results automatically and are harder to game. Impact of Provider Incentives on Quality and Value of Health Care SSI is Supplemental Security Income. The included studies assessed a variety of outcomes, from patient-reported measures (i.e., patient satisfaction) to clinical behaviors (i.e., immunization rates or cervical cancer screening) to clinical and physiologic measures (i.e., A1C levels for patients with diabetes mellitus). But in practice, physician payments under Medicaid are adjusted for only a limited set of characteristicstypically patient's age, sex, eligibility category, and county of residence. Then each State's expenditure is divided by the U.S. mean. Quality of care was defined as patient-reported outcome measures, clinical behaviors, and intermediate clinical and physiologic measures. In a larger study (172 patients per arm rather than the close to 40 patients per arm in the current study) this difference may have been statistically significant and many diabetes interventions are thought to be clinically important if they improve control to this degree. Ethical guidelines for holding employees responsible for their health. This would be far more than what is covered by the Medicaid program (Kosterlitz, 1989). Creating Incentives for Accountability in Patient Care For instance, even without space constraints, it cannot systemically investigate quality of care, because evidence is not obtainable for most programs. Financial incentives are generally broken down into two large categories - incentives directed at providers (health plans, practice groups, and individual providers) and incentives directed at patients or employees. One of the only studies to look at P4P in a disadvantaged U.S. population looked at the impact of a P4P program implemented in 2004 at Access Community Health Network (ACCESS), a system of federally qualified health centers in Chicago. Although most of the studies showed modest improvements in some of the preset quality measures, the improvements were not consistent among all quality measures, and the cost associated with the financial incentives was often substantial. In a recent study, these doctors were more likely to perform the costly procedure than doctors paid a flat salary. In particular, HMOs often capitate individual physicians or groups of physicians for primary care services and may put physicians at risk for specialty care services and hospital care. Despite the growing popularity of financial incentives in health care payment models, there is limited evidence that these incentives improve quality of care. Accessibility Diabetic patients with and without co-morbid conditions both showed improvement [18] and the quality of diabetes care improved similarly in patients with and without mental illness in the first year of QOF [19]. Enrollment is mandatory for all AFDC beneficiaries. The council recommends that no less than 40 percent of the physician workforce practice primary care; that existing primary care practices be transformed into new models such as patient-centered medical homes; and that payment reward care that is comprehensive, continuous, coordinated, and community-based, all hallmarks of high quality. However, no baseline data was reported and the PPO rolled out a diabetes disease management program shortly after P4P, making it difficult to determine the actual impact of the P4P program. Generally speaking, there is a correlation between the monetary rewards offered by a job and the non-monetary benefits it provides, with higher paid jobs tending to offer better non-monetary . An alternative method of setting the standard level of expenditureagainst which savings will be calculatedmust be devised. This article, however, does not and cannot evaluate these programs in their entirety. All Rights Reserved. Any surpluses in this account are returned at the end of the year to the PCP. It is organized in three parts. The seventh study did not identify any improvements in the clinical indicators (i.e., cervical cancer screening or childhood immunization rates), or patient-reported satisfaction measures (i.e., access, trust, coordination of care, referral, and overall satisfaction).3 Six of the seven studies reported on group-based financial incentives as opposed to individual physician incentives. Financial incentives for both providers and patients create immediate rewards for actions that have no immediate benefit. Physicians base salaries were reduced between 1121%, but could be made up in incentives provided for additional visits and quality procedures above a pre-defined minimum productivity level. Medicare Hospices Have Financial Incentives To Provide Care in Assisted Living Facilities Report (OEI-02-14-00070) 01-13-2015 . $100 per month for being at or below their monthly target weight (4 lbs per month); or 3. Care dependency grant | South African Government And at least 35%, or more than $1 trillion, of the amount spent annually on . Incentive pay is any additional pay awarded to a worker or team based on . The overarching goal of pay-for-performance (P4P) is to incent healthcare providers, or delivery systems, to provide more evidence-based care to gain a downstream effect of improved health outcomes. Levin-Scherz, et al reported on the experience of a P4P program implemented in 2001 within the Partners Community HealthCare Inc (PCHI), the provider network associated with Partners HealthCare in Boston, MA. Long-term maintenance of weight loss: Current status. South Africa's healthcare system is inefficient - both public and private. LDL screening improved by 13.2% and nephropathy screening by 15.2%, both about twice the state average [22]. Partial capitation excludes hospital costs, making the risk smaller and the required risk group smaller also. It would build on the physician capitation program described later in this article. If a group of N physicians share surpluses equally, any specific physician will reap only 1/N of any surplus that he or she creates. How Non-Financial Rewards Widen Workplace Inequality - Forbes HHS Vulnerability Disclosure, Help The high fixed cost of these programs brings into question their cost-benefit as compared to other interventions. National Library of Medicine GP Budget Holding in the UK: Lessons from America. Conflicts of interest: I.S. In Santa Barbara and San Mateo, a quasi-governmental entity was established to perform this function. These have been well documented [5,6,10,4042]. Several programs protect physicians against selection bias by paying fee-for-service rates for pregnancy costs. While different approaches will work in different organizational cultures, financial incentives have their role in performance improvement. Peer mentoring and financial incentives to improve glucose control in african american veterans: A randomized trial. Three cluster RCTs examined smoking cessation; one controlled before-and-after study examined patients' assessment of the quality of care; one controlled before-and-after study examined cervical screening, mammography screening, and A1C level; one interrupted time series analysis focused on four outcomes in diabetes; and one controlled interrupted time series analysis (a difference-in-difference design) examined cervical screening, mammography screening, A1C level, childhood immunization, chlamydia screening, and appropriate asthma medication. For physicians who continue to see fee-for-service patients, the proportion of their patients that are capitated is likely to indicate the importance of capitation to the practice. 3,4 1. The use of instrumental variable techniques should be considered to assist with the identification of treatment effects in the presence of selection bias and other sources of unobserved heterogeneity. The existing literature indicates they probably spur initial gains which then level off or partially revert if incentives are withdrawn. 3. There have been no such savings to date. Because expenditures are a function of input prices, these expenditure figures are deflated by the wage index used by HCFA to pay hospitals. The Kitsap HIO is the only program reviewed here in which specialists share in the savings or deficits. Programs directed at patients show greater promise as a means to influence patient behavior and intermediate outcomes such as weight loss; however, the evidence for long term effects are lacking. An HMO, of course, accepts full risk for the health care of its members, although that risk may be shared with physicians. Financial incentives are associated with minimal, if any, improvements in quality of care provided by primary care physicians. Population intermediate outcomes of diabetes under pay-for-performance incentives in england from 2004 to 2008. As the number of patients in a physician's panel increases, this risk falls. Rather, covered expendituresall physician services and hospitalizationwere treated together. Adding to that complexity, Medicare, private insurers, and employers have now argued for incentives to increase care quality, decrease utilization, and improve overall outcomes [1]. A typical P4P model provides bonuses from a pre-determined incentive pool, usually in addition to the base salary or fee schedule of the provider [4,5]. All three of these have been shown to motivate behavior change. In one study of pay-for-performance incentives for cervical cancer screening, mammography, and A1C testing, the incentivized group achieved a statistically significant increase only in cervical cancer screening rates (5.3 versus 1.7 percent improvement), at a cost of $3.4 million in bonuses during the first year.4. There are multiple concerns about the potential negative effects of provider and patient directed incentive programs. While each visit in private practice generates revenue, each non-visit at Kaiser generates revenue. Different models allow individuals to work on their own or in teams. Risk arrangements under Medicaid usually distinguish among three types of medical services1: Reimbursement systems typically end up with two categories because specialty care physician services are combined either with PCP services or with hospitalization. The risk is mitigated, however, in that all contractors below a minimum enrollment threshold are placed in a common risk pool. Savings for physician services cannot be calculated, because no physician bills are submitted to the State, which simply makes a capitation payment. The risk arrangement of the Santa Barbara Health Initiative is typical of Medicaid HIOs. If there is a surplus, each PCP receives his or her withhold in full, regardless of whether the PCP's account is in surplus. Future P4P programs will need to be designed with these concerns in mind and closely monitored to evaluate these potential effects. Specialists are paid on a fee-for-service basis, also subject to the 15-percent withhold.
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