Pay for Quality

24 Pay for Quality KCE Reports 118
Taking into account this complexity and the multiple goals which should be incentivized
simultaneously, leads to the construction of more elaborate P4Q schemes. Some
authors suggest solving this problem by separating the complex calculations, formula
and adjustment procedures from the way in which quality performance feedback is
provided on the key targets driving the incentive. According to what needs
improvement other presentation methods can be used. Whereas the presentation of
one composite measure, summarizing the performance on any preferred level, can be
useful for general comparisons, the presentation of target specific data informs the
provider on which targets to centre future quality improvement initiatives and often
also which means can be used to accomplish them 101 , 102 , 103 , 104 , 105 , 106 .
3.2 THE P4Q CONTEXT
Hutchison et al. (in Frolich et al. 2004) point to the importance of considering the
context in which financial incentives are designed or implemented to understand their
potential effects 38 . Indeed, each provider’s efforts in responding to incentives are
mediated by characteristics of the local market, the medical organisation (if any) in
which he or she practices, individual provider characteristics and on patient
characteristics.
The following contextual aspects will be discussed in this section: the health care
system, the payer-provider relationship (with theoretical grounding), their respective
characteristics, and the patient’s characteristics.
3.2.1 The health care system
Obviously, it is essential that incentive models are congruent with the values of the
health care system. For instance, in Ontario, Custers et al. (2008) adopted 4 principles
that were congruent with the health care system values 75 :
1. Be fiscally prudent (no new money);
2. Be simple to administer (no additional administrative concerns);
3. Support a culture of continuous improvement (no one-shot action);
4. Improve equity in and access to quality of health services.
General aspects of the system include the type of system (insurance or NHS; level of
regionalisation), the public/private mix (% insured), the dominant payment system (fee
for service, salary, capitation, etc.) and the level of therapeutic freedom among
providers.
According to Conrad and Christianson (2004), these market and environmental
conditions will, among other things, drive investment in structural quality (medical
equipment, human capital) and could therefore be considered as exogenous
determinants of incentive programmes 35 . It can be argued that the market and
environmental characteristics will also drive process and outcomes related aspects of
quality, and hence the success of P4Q programmes.
For instance, the extent of competition between providers may affect their response to
incentives: a provider in a monopoly situation could maximise profits without improving
quality 38 . This level of competition is in its turn related to other healthcare system
characteristics, such as the degree of patients’ free choice to consult with providers of
their own choosing. Although P4Q is not directly related to the patient’s choice of a
provider, the number of providers one patient consults will influence responsibilities’
allocation and the level of care continuity to support high quality healthcare.
Interestingly, the appropriate and timely referring of patients is in several P4Q
programmes a quality target on its own. Furthermore, the level of decision making in
P4Q policy will influence the uniformity, transparency, awareness and general
acceptance of a P4Q programme design. The lower the level, the more risk for
fragmentation and for variously competing approaches. This reduces programme
awareness and acceptance of providers. It also reduces the impact size of the incentive
(the effect of one of many simultaneous programmes, also known as a dilution effect
versus the effect of one national programme).