P4P can improve quality, proponents say

Programs achieve results through incentives

Pay-for-Performance programs can improve both medical care and quality of life by giving health care providers a financial incentive to seek measurable improvements in the health of their patients, it was reported in a November 15, 2005 National Press Club briefing in Washington, DC. The findings were the combined result of seven experimental projects designed to test a variety of pay-for-performance models (P4P). Known as the Rewarding Results program, the three-year effort is both the largest and most diverse of its kind.

According to the findings, through use of incentives, the Rewarding Results projects have:

  • significantly increased patient visits to the doctor for everything from adolescent check-ups to diabetic screening among privately insured and Medicaid patients;
  • prompted physicians and physician groups to embrace information technology and electronic medical records at a faster pace;
  • increased the numbers of patients who receive annual mammograms, well-check ups, and other preventive screenings;
  • motivated physicians to monitor patient care more aggressively, particularly for chronically ill patients.

The projects "provide some of the first tangible evidence that P4P incentives can raise the quality of patient care," said Suzanne Delbanco, CEO of the Leapfrog Group, the organization providing technical assistance to the projects, which are supported by grants from the Robert Wood Johnson Foundation, the California HealthCare Foundation, and the Commonwealth Fund.

Despite their achievements, however, the report noted these projects are still grappling with:

  • working out what size financial rewards are needed to effect change;
  • how to engage physicians continuously in quality improvement activities linked to P4P;
  • whether the return on investment and the quality gains outweigh the financial and human effort;
  • how to sustain improvement with adequate information technology and other infrastructure;
  • whether P4P can work in all settings, particularly an environment in which there is a looser network of physicians such as a PPO — or even traditional Medicare.
  • The P4P programs highlighted at the conference were:
  • Blue Cross Blue Shield of Michigan, a pioneer in developing hospital-based incentive programs.
  • Blue Cross of California. The California-based health insurer stands out for implementing P4P in the most complex and most popular health insurance model — a preferred provider (PPO) network in the San Francisco market in which a loose network of physicians is not directed by any one health plan.
  • Bridges to Excellence (BTE). The largest employer-sponsored effort that rewards and recognizes physicians for meeting specific quality benchmarks, BTE doubled the number of diabetics seeing physicians.
  • Excellus/Rochester Individual Practice Association (RIPA). Excellus/RIPA has improved the management of patients with sinusitis, otitis, diabetes, asthma and heart disease by giving doctors measures of quality, affordability, and satisfaction.
  • Integrated Healthcare Association (IHA). A California-based coalition of health plans, physicians, health care systems, purchasers, and consumers, IHA has issued a public scorecard, comparing actual physician group performance. Through its efforts, it has seen an increase in improvement across the board in every quality measure they are using.
  • Local Initiative Rewarding Results (LIRR). The largest collaborative P4P effort to improve the health of babies and teens in Medicaid, LIRR found that simple targeted incentives can improve children’s health. The California-based project involved seven health plans, paid out $5 million, engaged 3,300 physicians, and touched the lives of 350,000 babies, teens, and parents. Five of seven plans improved the rate of well-baby visits, with increases from 4% to 35%.
  • Massachusetts Health Quality Partners (MHQP). Working with five health plans and physician organizations in the state, MHQP designed and implemented a performance report that for the first time enables comparison of physician organization performance on a common set of quality measures.