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Posts made in February, 2010

Research Studies Efficacy of Pay for Performance Incentive Programs

Both to be Published in Prominent Journals

The Research Institute of the Palo Alto Medical Foundation (PAMF) will have two of its studies published in professional journals this month. Both studies assess the efficacy of Pay for Performance (P4P) programs.

In the health care industry, P4P programs are designed to offer financial incentives to physicians and other health care providers who meet defined quality, efficiency and patient safety targets.

The research project titled “Effect of Physician-specific Pay-for-Performance Incentives in a Large Group Practice Pay-for-Performance” will be published in the February issue of the American Journal of Managed Care. The study examined the effects of physician-specific, P4P incentives on outpatient (non-hospital) quality measures at PAMF’s Palo Alto Division in 2007.

Sukyung Chung, Ph.D, lead author of both studies, explained that well-established, quality-of-care indicators were demonstrated to continue improvement during a trial of physician-specific quality financial incentives.

“In the context of other quality improvement efforts, physician-specific incentives appear to have some incremental effect on improving quality of care. These changes reflect quality of care provided, not only the quantity of procedures conducted,” Dr. Chung said.

A second research paper, which is also being published in Health Services Research in February, asks: “Does the Frequency of Pay for Performance Payment Matter?” Authors of this study are Sukyung Chung, Ph.D, Latha Palaniappan, M.D., Eric Wong, Haya Rubin, M.D., Ph.D., and Harold Luft, Ph.D.

This research team examined the effects of the “frequency” of incentive payment in the P4P program using a randomized experiment design. In other words: does the timing of an incentive payment, received as either four quarterly bonus checks or a single year-end bonus, affect performance? The short answer is: no.

The study assessed the effect of the P4P program on quality of care measures with 180 primary care (pediatric, family and internal medicine) physicians. One group received P4P incentive payments in four quarterly payments and the second received one check at the end of the year. The total achievable incentive amount was the same. The Research Institute’s study showed that the physicians’ responses to a P4P program do not differ by frequency of bonus payment.

Since the initiation of P4P in California, PAMF has consistently received high scores. The performance indicators prioritized by PAMF include clinical quality, patient satisfaction, information technology and cost/efficiency, all of which promote and sustain quality improvement. These studies’ findings will be used by PAMF physician leadership to inform their decisions on what role P4P assessments might play in the future.

Both studies included work supported under a contract with the Agency for Healthcare Research and Quality.

The PAMF Research Institute was created in 1950 as a center for basic and clinical research, and now focuses on health services research and health policy research, examining how health care is delivered, how to manage costs and how to improve quality.