Patient experience now linked to doctors' payment

Incentives may spur "cherry picking" of patients

The amount of reimbursement hospitals receive will be tied to physicians' ability to communicate with patients, manage their pain, and explain medications, as a result of the Centers for Medicare & Medicaid (CMS)'s Hospital Value-based Purchasing Program, which will affect Medicare reimbursements as of October 2012, notes Marshall H. Chin, MD, MPH, Richard Parrillo Family Professor of Medicine at the University of Chicago.

"There is more of an emphasis on value, both in public policy as well as the private marketplace," he says. "With health care organizations competing for market share, providers realize they have to provide higher quality care at lower cost. Part of that is assuring a high quality patient experience."

In CMS's value-based purchasing system, 30% of incentive payments are determined by patient experience ratings and 70% on clinical performance.

"For participating hospitals, their base operating DRG payments will be reduced by 1% to fund the program, so the potential incentives and penalties are relatively small," says Chin. "In the private marketplace, there are wider variations for how much a physician's salary is at risk."

Negative unintended consequences could occur if providers seek out patients that are likely to give higher experience scores, warns Chin. Sicker, complex patients, depressed patients, and non-English speaking patients tend to give lower patient experience ratings to providers, and ratings may be higher if there is patient-physician race concordance.

"There could be an incentive for providers to dump patients that may make them look bad in terms of ratings, or to 'cherry pick' easier, healthier patients that may be more likely to rate them higher," he says, while systems may penalize providers who care for sicker or non-English speaking patients.

The incentives may spur providers, whether consciously or unconsciously, to seek healthier, less complex patients and avoid caring for racial or ethnic minorities, says Chin, director of the Robert Wood Johnson Foundation's Finding Answers: Disparities Research for Change National Program Office.

Another ethical concern is that systems may be designed so "the rich get richer and poor get poorer," says Chin. It could be difficult for academic medical centers, hospitals that serve a large number of poor patients or minorities, or county hospitals with many non-English speaking patients to do well with these ratings, he explains, just because of the populations they serve.

Providers should be paid based on improvement as well as absolute levels, Chin recommends, and hospitals that are coming from a tougher starting point should be given adequate quality improvement resources so they aren't at a disadvantage.

"If the system isn't designed well, you can have a situation where affluent hospitals do well with reimbursement, while hospitals that tend to serve the disenfranchised have a harder road," he says.


  • Marshall H. Chin, MD, MPH, Richard Parrillo Family Professor of Medicine, University of Chicago. Phone: (773) 702-4769. Email: