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18 Cards in this Set
- Front
- Back
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Outline
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Introduction
- Why Measure Quality? - Linked to incentives? Incentive Design - Target entity - Nature - Financial/Non-financial - General/Selective - Reward/Penalty - Performance - Structure - Process - Outcome - Magnitude - Certainty, Frequency, Duration - Motivational base - Base of comparison |
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Introduction – Why Quality Incentives?
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Variations in Clinical Practice
eg variations in CABG freq between nations → (diff epi), diff uptake of technology (CABG v PCTA), eg variations in preventive care – failure of incentives |
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Measurement of Quality/ Performance
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1. Avoidable hospitalization diagnoses
a. selected by panel of physicians b. conditions that can prevented, controlled or managed over time without the need for hospitalization if the patient receives timely and appropriate ambulatory care c. indicators of access and adequacy of ambulatory care |
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Incentive Theory
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1. Microeconomic theory – provider response is shaped by incentives, constraints, opportunities and preferences
2. Agency theory – design payment levels and types to balance provider participation constraint and incentive compatibility 3. Cognitive psychology – trade-off of extrinsic and intrinsic motivation; if ethical incentives are high then you don’t want to distort them by increasing external signals 4. Must balance and integrate three theories |
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Incentive Design
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Target
Nature - general specific - financial non-financial - magnitude - reward penalty Performance measure Certainty, frequency, duration Motivation base Base of comparison |
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Incentive Design – Nature of the Incentive
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Reward/penalty
- both work - more reward than penalty by health plans in US - politically palatable: withhold v clawback o price-volume payback beggar thy neighbhor o budget – incentive to increase prior year Germany prescribing budgets Financial non-financial - public reporting – reputation – capital asset – economic and psychic value - financial o general – payment mechanism for patient care • FFS – expand services – quantity complement quality eg pediatric residents • Capitation – get more patients full cost - competition • Salary – insulates; productivity non-financial incentive o selective • bonus • tiered copayment • reimbursement rate → mix provider payment mechanism to optimize policy objectives |
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Incentive Design – Target entity
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a. group v. individual
b. empirical evidence – - group incentives dominate aggregate data is more available; free-rider problem unless group is small enough for informal monitoring and peer pressure - incentives are stronger at the individual level eg focus on physician prescribing in US & UK c. policy implications – - group incentives – infrastructure - IT/EHR, chronic disease registries - individual incentives – reliable, precise & individually controllable performance measures |
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Incentive Design – Performance dimension
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a. structure (supply char) poorly correlated with quality of care
b. process (recommended rx) – value in link with outcome - preferred c. outcome measures (health status) – control for exogenous determinants of outcomes (patient adherence, social determinants of health) – attribution and causality; time d. clinical relevance and credibility of metrics crucial to physician buy-in e. policy implications – - structure and process within control of physicians - less weight on outcome; degree of provider control - risk adjustment of outcome measures - periodic recalibration of process measures - up-to-day with technology |
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Incentive Design – Magnitude
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a. size of financial incentive
b. empirical evidence – - no estimates of a dose-response relationship - predominantly modest (2-9% of base income in US) - QOF UK GP – 70% capitation, 30% incentive payment c. policy implications – - magnitude = marginal cost of quality improvement - high rents and a narrow quality metric → gaming |
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Incentive Design – Certainty
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a. predictability and sustainability of incentive payoff is crucial; implications for dynamic budget neutrality
b. empirical evidence – little research; increased emphasis on stability and achievability of measure |
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Incentive Design – Frequency
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a. frequency of payoff
b. empirical evidence – some evidence of dulled incentives with end-of-year payoff c. policy implications – - more frequent payoffs create great salience and proximity to incentivized behavior - frequent payoffs impose greater demands on data systems and risk creating a short term measurement perspective |
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Incentive Design – Duration
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a.
b. empirical evidence – no systematic comparisons; structured reviews in cognitive psychology suggest extinction after short-run incentive ends c. policy implications – - long term incentives – greater investment in structure and care processes - increasing rate of return on investment |
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Incentive Design – Motivation base
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self-regulation profession
a. crowd out of intrinsic motivation; gaming c. policy implications – - align with incentives with intrinsic motivation (eg altruism) to avoid cream-skimming - broad metrics will mitigate treating to the test |
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Base of comparison
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- absolute performance-based incentives - provider control in attaining the reward
- threshold– excellence is squeezed by targets - continuously increasing incentives to compensate for marginal costs - more actuarial uncertainty for payers - relative performance - comparative information of providers - adjusts for shocks common to providers in same area - public reporting - heightens competition - more actuarial certainty for payers |
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Case Study: Medicare HQID
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- 2003 → 2006 continuous hospital quality improvement with financial incentives
- benchmarking – 80% of hospitals have incentives to do better - composite indicator in 5 clinical areas of 30 quality measures - - reduction in variance (narrowing of range) - median trending upward |
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Financial incentives for quality (Conrad & Christianson)
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1. Bonus payments
2. Tiered co-payments (lower patient cost-sharing for high-quality providers) 3. Increased reimbursement rates |
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Quality and Reimbursement
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1. Fixed salary – insulates physician from costs increasing quality (non-financial incentives for quality)
2. FFS – incentive to expand range of services – will increase quality if complements quantity 3. Capitation – physician bears direct costs of quality improvement – no incentive unless competition for patients – incentives to expand patients |
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mixed payment models
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interrelated performance goals: maximum patient health benefit at least cost
interaction between general incentives and selective incentives eg capitation + FFS bonus payments QOF |
