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PubMed2000

How will PPS realign financial incentives and care? An indepth panel discussion by NAHC experts. National Association for Home Care.

The new prospective payment system (PPS) that will take effect for Medicare-participating agencies on October 1, 2000 will create a dramatic change in the culture of home care that has existed since the inception of the home care benefit in 1965. Will these changes be for the better or for the worse? Who will be the winners, and who will be the losers? How will these incentives change the behavior of home care agencies and the caregivers they employ in their efforts to provide health care to the infirm and disabled?

Aged↗

PubMed1987

Financial incentives of subregional RAWP.

Accounting for the cross boundary flows of residents from one health authority treated by another has been considered by the review of the Resource Allocation Working Party (RAWP) formula by the National Health Service Management Board. A common concern is that the approximate costs used are unfair to those authorities (typically those with teaching hospitals) that are likely to treat more complex cases. This paper argues that when spending exceeds the target allowance for acute services this is more likely to be due to district residents using services at a high rate than to inadequate compensation for inflows. Districts where residents make a high use of services are often those where there are large flows across district boundaries. Since authorities cannot control outflows there is little they can do to reduce their residents' high use of services. Furthermore, curious financial incentives can be inferred for clinicians in these districts if they were to take effective action to bring their district's spending to target levels. These problems are discussed to illuminate problems of accounting for cross boundary flows that alternatives to current practice must resolve.

Health Resources↗

PubMed1997

Savings from a Medicaid carve-out for mental health and substance abuse services in Massachusetts.

OBJECTIVE: The study examined the financial performance of a managed behavioral health care organization responsible for mental health and substance abuse services under the Massachusetts Medicaid program. Financial performance is considered in light of incentives in the contract between the managed care firm and Medicaid. METHODS: Data on the financial performance of the managed care organization were obtained from documents related to a recent rebidding of the contract and other publicly available documents. Financial incentives associated with claims costs and administrative services are also reported. RESULTS: Spending by the managed care organization was about 25 percent lower than projected expenditures adjusted for inflation. Explicit financial incentives associated with cost reduction did not give the managed care organization strong inducements to attain these savings. The profit and loss features based on cost targets were quite limited. The organization had a much greater incentive and opportunity to make profits by conserving its administrative costs rather than by controlling Medicaid claims costs. CONCLUSIONS: In light of the contract's weak cost-saving incentives, it may be surprising that so much was saved. One explanation is that it was easy to achieve such savings in a state with high expenditures. However, in examining the particular amounts saved, it is clear that the organization came close to contract targets even when incentives to achieve them were weak. The authors label this behavior "managing to the contract" and discuss some reasons why a managed care organization might behave in this way and the implications this behavior has for contract design.

Contract Services↗

PubMed2002

Interventions that increase use of adult immunization and cancer screening services: a meta-analysis.

PURPOSE: The relative effectiveness of the diverse approaches used to promote preventive care activities, such as cancer screening and adult immunization, is unknown. Despite many high-quality published studies, practices and policymakers attempting to improve preventive care have little definitive information on which to base decisions. Thus, we quantitatively assessed the relative effectiveness of previously studied approaches for improving adherence to adult immunization and cancer screening guidelines. DATA SOURCES: MEDLINE, the Cochrane Effective Practice and Organization of Care Review Group register, previous systematic reviews, and the Medicare Health Care Quality Improvement Project database. STUDY SELECTION: Controlled clinical trials that assessed interventions to increase use of immunizations for influenza and pneumococcal pneumonia and screening for colon, breast, and cervical cancer in adults. DATA EXTRACTION: Two reviewers independently extracted data on characteristics and outcomes from unmasked articles. Intervention components to increase use of services were classified as reminder, feedback, education, financial incentive, legislative action, organizational change, or mass media campaign. DATA SYNTHESIS: Of 552 abstracts and articles, 108 met the inclusion criteria. To assess the effect of intervention components, meta-regression models were developed for immunizations and each cancer screening service by using 81 studies with a usual care or control group. The most potent intervention types involved organizational change (the adjusted odds ratios for increased use of services from organizational change ranged from 2.47 to 17.6). Organizational change interventions included the use of separate clinics devoted to prevention, use of a planned care visit for prevention, or designation of nonphysician staff to do specific prevention activities. The next most effective intervention components were patient financial incentives (adjusted odds ratios, 1.82 to 3.42) and patient reminders (adjusted odds ratios, 1.74 to 2.75); the adjusted odds ratios ranged from 1.29 to 1.53 for patient education and from 1.10 to 1.76 for feedback. CONCLUSIONS: Rates of adult immunization and cancer screening are most likely to improve when a health care organization supports performance of these activities through organizational changes in staffing and clinical procedures. Involving patients in self-management through patient financial incentives and reminders is also likely to positively affect performance.

Adult↗

PubMed1986

Redefining the hospital-physician relationship under prospective payment.

In response to the rapid increases in the costs of health care in the 1970s and early 1980s, the Medicare prospective payment system (PPS) now places hospitals at financial risk for services provided to their Medicare patients. Although hospital boards and administrators can pursue a variety of steps to reduce the cost of care, the hospital must ultimately rely on its medical staff for fundamental change. This paper describes the incentive conflicts that face hospitals and physicians as a result of PPS and identifies a series of options with which hospitals and their medical staff members can resolve the conflict.

Cost Control↗

PubMed2002

Managing the behavior of the medically insured in Germany: the acceptance of cost-sharing and risk premiums by members of the statutory health insurance.

In the course of the conflicts over the reform of statutory health insurance in Germany complaints about moral hazard-behavior on the part of the insured were repeatedly raised and linked to the demand for expanding managerial incentives aimed at reducing the consumption of health care benefits (copayments). However, critics and supporters of managerial incentives mostly neglect the perceptions and dispositions of the insured. In contrast, the article examines how members of the statutory health insurance scheme assess managerial intervention, namely cost-sharing and risk premiums.

Cost Sharing↗

PubMed2001

Influence of financial productivity incentives on the use of preventive care.

PURPOSE: We examined whether physician factors, particularly financial productivity incentives, affect the provision of preventive care. SUBJECTS AND METHODS: We surveyed and reviewed the charts of 4,473 patients who saw 1 of 169 internists from 11 academically affiliated primary care practices in Boston. We abstracted cancer risk factors, comorbid conditions, and the dates of the last Papanicolaou (Pap) smear, mammogram, cholesterol screening, and influenza vaccination. We obtained physician information including the method of financial compensation through a mailed physician survey. We used multivariable logistic regression to examine the association between physician factors and four outcomes based on Health Plan Employer Data and Information Set (HEDIS) measures: (1) Pap smear within the prior 3 years among women 20 to 75 years old; (2) mammogram in the prior 2 years among women 52 to 69 years old; (3) cholesterol screening within the prior 5 years among patients 40 to 64 years old; and (4) influenza vaccination among patients 65 years old and older. All analyses accounted for clus-tering by provider and site and were converted into adjusted rates. RESULTS: After adjustment for practice site, clinical, and physician factors, patients cared for by physicians with financial productivity incentives were significantly less likely than those cared for by physicians without this incentive to receive Pap smears (rate difference, 12%; 95% confidence interval [CI]: 5% to 18%) and cholesterol screening (rate difference, 4%; 95% CI: 0% to 8%). Financial incentives were not significantly associated with rates of mammography (rate difference, -3%; 95% CI: -15% to 10%) or influenza vaccination (rate difference, -13%; 95% CI: -28% to 2%). CONCLUSIONS: Our findings suggest that some financial productivity incentives may discourage the performance of certain forms of preventive care, specifically Pap smears and cholesterol screening. More studies are needed to examine the effects of financial incentives on the quality of care, and to examine whether quality improvement interventions or incentives based on quality improve the performance of preventive care.

Adult↗

PubMed2002

Dual job holding practitioners in Bangladesh: an exploration.

This paper analyses the system of financial and non-financial incentives underlying job preferences of doctors in Bangladesh who work both in government health services and in private practice. The study is based on a survey of 100 government-employed doctors with private practice, across different levels of care and geographical areas. In-depth interviews were carried out in a sub-sample of 28 respondents. The study explores the beliefs and attitudes towards the arrangements of joint private/public practice, establishes profiles of fee levels and earnings and examines the options to change the incentive system in a way that ensures an increased involvement of dual job holding practitioners in the priority areas of care. Consultation fees were Tk120 on average (range Tk20-300) and found to be correlated with the qualification of the practice owner and the type of service offered. A majority of the respondents reported at least to double their government income by engaging in private practice. Significant predictors of total income included the number of patients seen in private practice (p=0.000), employment in a secondary or tertiary care facility (p=0.001) and ownership of premises for private practice (p=0.033). Age was found to be marginally significant (p=0.084). No association was found between total income and specialisation, private practice costs, level of government salary or a degree from abroad. The data suggest that doctors have adopted individual strategies to accommodate the advantages of both government employment and private practice in their career development, thus maximising benefit from the incentives provided to them e.g. status of a government job, and minimising opportunity costs of economic losses e.g. lower salaries. Commitment to government services was found to be greater among doctors in primary health care who reported they would give up private practice if paid a higher salary. Among doctors in secondary and tertiary care, the propensity to give up private practice was found to be low. Financial incentives that aim to increase numbers of doctors in rural areas, such as a non-private-practice allowance, are more likely to be appreciated by doctors who are at the beginning of their career. Improved training and career opportunities also appear to be of high importance for job satisfaction. Policy changes to ensure a better resource allocation to the priority areas of the health sector have to reflect an understanding of the incentives generated by the organisational and financial context within which dual job holding practitioners operate.

Ambulatory Care↗

PubMed1996

New assumptions concerning IPAs and cost of dental care.

OBJECTIVES: Previous studies suggest that fee-for-service (FFS) patients receive more treatment and at a greater cost than capitation patients. In this study treatment plans of dentists who are members of an independent practice association (IPA), a preferred provider organization (PPO), or who are paid their usual fee for service are compared. METHODS: A carefully selected and trained professional actor, with actual dental disease and recent radiographs, was sent to the offices of general practice dentists for an examination and treatment plan. To one group of dentists (n = 21) the patient said he was a member of a PPO plan served by that dentist, to a second group (n = 15) he said he was a member of an IPA plan served by that dentist, and to the third group (n = 19) he said he would pay by the traditional FFS method. RESULTS: IPA dentists recommended more restorations (mean = 9.60) than those in the PPO program (mean = 5.95) or those paid by the traditional FFS method (mean = 5.58). The anticipated mean cost to the patient was higher for the IPA dentists ($1,815.20) compared to the other two types (PPO = $1,186.24, FFS = $1,470.42). CONCLUSIONS: The IPA models studied in this investigation permitted dentists to charge copayments for most treatments beyond basic services. This type of IPA might be similar to a fee-for-service model that provides practitioners with an incentive to do more rather than less treatment.

Adult↗

PubMed2000

Tracking managed care: the importance of a cash incentive for medical director response to a survey.

OBJECTIVE: To assess the impact of a monetary incentive in a survey mailed to medical directors of large medical groups and independent practice associations (IPAs). STUDY DESIGN: Mailed survey. METHODS: We mailed a survey to the medical directors of all medical groups and IPAs contracted with Blue Cross California Care, a large California managed care health plan (n = 174). After 2 mailings without any monetary incentive, we included a $50 bill in the third mailing to increase the response rate. RESULTS: Only 46 medical directors responded to the first and second mailings (response rates of 17% and 13%, respectively). The third mailing, which included a $50 bill attached to the front of the survey, yielded 78 responses (66%), for an overall total of 124 (76%). We found no significant differences in the physician organizations of medical directors who responded to the mailing with the $50 incentive compared with the physician organizations of those who responded to 1 of the first 2 mailings, although medical directors who responded without the financial incentive were more likely to report that their organization had staff for quality assurance (96% vs 82%; P < or = .03). CONCLUSION: Including a $50 bill improved the rate of response to a survey mailed to medical directors from 13%-17% to 66%.

Aged↗

PubMed1994

Skewed incentives in our healthcare delivery system.

Policymakers agree that cost-containment in healthcare delivery cannot be attained unless the incentives for providers, patients, and payers can be changed. The authors review the existing incentives that have led to escalating costs and conflicting interests for providers, patients, employers, third-party payers and taxpayers. They examine the current incentives for each group and explore the changing incentives that the new integrated healthcare systems and managed care present. They conclude that the new systems are not a simplistic solution to the "healthcare crisis" in cost, access, and quality, but they emphasize that these new systems have already introduced new incentives for provider collaboration and cooperation. The traditional ties of the osteopathic medical profession allow a quick response to creating new integrated systems, but require collaboration to add tertiary care to the profession's strong primary care and community hospital base.

Conflict of Interest↗

PubMedDate not supplied

Pay-for-performance: the MedPAC perspective.

Medicare payment systems are neutral and sometimes negative toward quality of care. The Medicare Payment Advisory Commission (MedPAC) has recommended that Congress build incentives for quality into Medicare's payment systems for hospitals, physicians, home health agencies, facilities that treat dialysis patients, and Medicare Advantage plans. In this Commentary we describe the rationale for the recommendations, criteria for determining which settings are ready, program design principles, and potential measures.

Aged↗

PubMed1994

Safety belt education using visual crash images and low-cost incentives.

Automobile safety belt use among teen-agers remains low despite high crash morbidity and mortality. This article describes a model of a community-based safety belt promotional program. Ten public high schools, with student club and administrative support, were selected from across Mississippi. Safety belt assemblies, which created vivid crash images, were conducted using police officers, ambulance personnel, people with paraplegia, football players, and others. Low-cost incentives were awarded to buckled students over a 10-week period. Implementation of the program resulted in a mean increase of 21% in male safety belt use and 17% in female safety belt use. Concepts used in the program are reproducible, at minimal cost, by using personnel found in most communities.

Adolescent↗

PubMed1998

Prohibition of "gag clauses" in the Federal Employees Health Benefits Program--OPM. Notice of proposed rule making.

The Office of Personnel Management (OPM) is proposing to amend the regulations to prohibit health benefit carriers participating in the Federal Employees Health Benefits (FEHB) Program from entering into contractual provisions with health care providers or health care workers that would include a provision for incentive payments as an inducement to reduce or limit communication with, or the delivery of health care services to, FEHB enrollees. The rule is intended to ensure providers' and health care workers' ability to communicate with, and advise patients of, any medically necessary treatment options.

Communication↗

PubMed2003

The development of prescribing incentive schemes in primary care: a longitudinal survey.

Primary Care Groups and Trusts in England (Primary Care Organisations, or PCOs) are required to operate a prescribing incentive scheme. Little is known about their development since their inception in 1999. We surveyed incentive schemes in London and the South-East NHS Regions in the two consecutive years since 1999. Most of the changes to the incentives and prescribing indicators favoured improvements in prescribing quality, rather than cost control. Quality improvements may be hampered in those PCOs offering financial rewards to underspent general practices that fail to achieve any prescribing quality targets.

Cost Control↗

PubMedDate not supplied

Risk sharing between competing health plans and sponsors.

In many countries, competing health plans receive capitation payments from a sponsor, whether government or a private employer. All capitation payment methods are far from perfect and have raised concerns about risk selection. Paying health plans partly on the basis of capitation and partly on the basis of actual costs ("risk sharing") reduces plans' incentives for selection but sacrifices some incentives for efficiency. This paper summarizes our empirical research on Dutch health plans with respect to various forms of risk sharing. All sponsors can improve their payment systems by either implementing or changing their form of risk sharing.

Capitation Fee↗

PubMed1996

Incentives to promote quality improvement in long-term care.

Long-term care acute care providers are using innovative, data-based approaches and information systems solutions to position themselves for the future. These approaches will significantly improve the ability of these providers to treat patients, justify their continued existence, and compete in the marketplace.

Community-Institutional Relations↗

PubMed1991

A simultaneous equations model of employer strategies for controlling health benefit costs.

We estimated a simultaneous equations model of employer health insurance cost control strategies and their effectiveness in reducing health plan premiums. We hypothesized that as premiums increase, employers will shop more actively for health plans, place incentives on providers to control medical care costs, increase employee cost sharing for medical care, and be more likely to offer an HMO. In turn, we expected each of these strategies, except offering an HMO, to reduce average health plan premiums. The model was estimated with 1985 data from a sample of 922 Minnesota employers. We found that high premiums are related to three of the proposed cost control strategies. Employers with higher premiums shop more, are more likely to seek provider incentives, and offer an HMO. However, these employers appear to have lower employee cost sharing. Employers with higher employee cost sharing and those that offer an HMO had lower health plan premiums.

Community Participation↗