Effects of paying physicians based on their relative performance for quality

  • Young G
  • Meterko M
  • Beckman H
 et al. 
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BACKGROUND:Studies examining the effectiveness of pay-for-performance programs to improve quality of care primarily have been confined to bonus-type arrangements that reward providers for performance above a predetermined threshold. No studies to date have evaluated programs placing providers at financial risk for performance relative to other participants in the program.

OBJECTIVE:The objective of the study is to evaluate the impact of an incentive program conferring limited financial risk to primary care physicians.

PARTICIPANTS:There were 334 participating primary care physicians in Rochester, New York.

DESIGN:The design of the study is a retrospective cohort study using pre/post analysis.

MEASUREMENTS:The measurements adhere to 4 diabetes performance measures between 1999 and 2004.

RESULTS:While absolute performance levels increased across all measures immediately following implementation, there was no difference between the post- and pre-intervention trends indicating that the overall increase in performance was largely a result of secular trends. However, there was evidence of a modest 1-time improvement in physician adherence for eye examination that appeared attributable to the incentive program. For this measure, physicians improved their adherence rate on average by 7 percentage points in the year after implementation of the program.

CONCLUSIONS:This study demonstrates a modest effect in improving provider adherence to quality standards for a single measure of diabetes care during the early phase of a pay-for-performance program that placed physicians under limited financial risk. Further research is needed to determine the most effective incentive structures for achieving substantial gains in quality of care.

Author-supplied keywords

  • Diabetes
  • Financial incentives
  • Pay-for-performance
  • Quality of care

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  • Gary J. Young

  • Mark Meterko

  • Howard Beckman

  • Errol Baker

  • Bert White

  • Karen M. Sautter

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