Pay for Quality

KCE Reports 118 Pay for Quality 33
Key points
• P4Q programmes are intended to offer explicit financial incentives to
providers in order to achieve predefined quality targets. Quality goes further
than the strict clinical outcome. It includes 7 dimensions: safety, clinical
effectiveness, patient centeredness, timeliness, equity of care, efficiency of
care and continuous and integrative care b . Furthermore quality can be
expressed in structural, process and outcome quality criteria. Many P4Q
programmes focus mainly on structure and process outcomes. However,
given the scarcely grounded relationship between process measures and
long term patient outcome measures, overly relying on structure and
process outcomes threatens the credibility of a P4Q programme. As
important as the choice of criteria is the final number of criteria. Too few
criteria could draw the attention of providers away from the not
incentivized criteria. Too many criteria could lead to organisational
complexity. When setting these criteria, it is important to verify that the
criteria are measurable. A valid and comprehensive management
information system to track performance against the goals must be
available. Correct measurement makes use of risk adjustment. Some P4Q
programmes make use of exception reporting. Gaming, patient selection
and diversion of attention are the most important types of unintended
consequences.
• Financial incentives are considered as the core of a P4Q programme.
Several possible incentives structures are possible: bonuses, performance
based fee schedule, performance based withholds, regular payment increase
linked to performance and quality grants/financial awards/performance
funds. There is still some disagreement amongst researchers about whether
bonuses or penalties should be applied. Most programmes make use of
bonuses whereby ideally, an incentive size should amount up to 5% of
income and according to some authors even up to 10% of income. The
formulation of the incentive arrangement is of importance. Rewarding a
threshold could discourage low-quality providers to engage in the P4Q
programme. P4Q programmes often provide payment only on one or a few
fixed time points. Some P4Q programmes attach payment weights to
specific quality targets as a function of the estimated related workload, or to
express the relative importance of a target in terms of public health. Some
P4Q programmes make use of an absolute reward whereby anyone who
performs well obtains the reward no matter how the other providers
perform. Other P4Q programmes use a ‘tournament approach’, where
providers compete against one another. The latter method has the
advantage that the expenses are more under control, however the
uncertainty about what can be achieved could provoke providers not to
engage in the programme. Finally, a balance should be found between the
simplicity of the programme on the one hand and sufficient attention for all
the issues related to P4Q complexity on the other hand.
• Health care, payer, provider and patient characteristics are the main
contextual factors and are of influence in various ways. Not taking these
factors into account will compromise the success of a possible P4Q
programme.
• Several market and environmental characteristics, like the private/public
mix, the dominant payment system, the level of competition and the level of
therapeutic freedom among providers, can drive quality, and thus P4Q
success.
b Quality on a global level also involves reducing variability in care