Background Pay for performance has increasingly become the subjectof intense interest and debate, both of which have been heightenedas the Centers for Medicare and Medicaid Services moves closerto adopting this approach for Medicare. Although many claimshave been made for the effectiveness of this approach, the extentof its national penetration remains unknown.
Methods We surveyed a sample of 252 health maintenance organizations(HMOs) (response rate, 96%) drawn from 41 metropolitan areasacross the nation about use of pay for performance. We determinedthe prevalence of pay-for-performance programs, detailed thefeatures of such programs, and examined the adoption of payfor performance as a function of the characteristics of boththe health plans and markets.
Results More than half the HMOs, representing more than 80%of persons enrolled, use pay for performance in their providercontracts. Of the 126 health plans with pay-for-performanceprograms, nearly 90% had programs for physicians and 38% hadprograms for hospitals. Use of pay for performance was statisticallyassociated with geographic region, use of primary care providers(PCPs) as gatekeepers, use of capitation to pay PCPs, and whetherthe plans themselves received bonuses or penalties accordingto performance.
Conclusions Pay for performance is now commonly used by HMOs,especially those that are situated to assign responsibilityfor a particular patient to a PCP or medical group. As the designof Medicare with pay for performance moves forward, it willbe important to leverage the early experience of pay for performancein the commercial market.
Source Information
From the Departments of Health Policy and Management (M.B.R., A.M.E.) and Biostatistics (S.-L.T.N.), Harvard School of Public Health; the Department of Health Care Policy, Harvard Medical School (B.E.L., S.-L.T.N., R.G.F., A.M.E.); the Division of General Medicine and Primary Care, Beth Israel Deaconess Medical Center (B.E.L.); and the Division of General Medicine, Brigham and Women's Hospital (A.M.E.) all in Boston.
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