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Care for the chronically ill: nursing home incentive payment experience.

Nursing home reimbursement systems which do not adjust payment levels to patient care needs lead to access problems for heavy-care patients. Unnecessarily long and costly hospital stays may result. A patient-based nursing home incentive reimbursement system has been designed and is being evaluated in a controlled field experiment in 36 California skilled nursing facilities. Incentives are paid for admitting heavy-care patients, meeting outcome goals on some patients, and discharging and maintaining some patients in the community. This article describes a nursing home reimbursement system which is intended to simultaneously mitigate problems of restricted access, inefficient use of beds, and nonoptimal care. It also discusses the approach to evaluating this broad social intervention by application of a controlled experimental design.

California↗

Finance issue brief: bans on financial incentives.

Following efforts to ban the use of gag clauses, state lawmakers now are turning their attention to prohibiting managed care plans from using financial incentives. Twenty-seven states have enacted laws banning the use of such incentives.

Humans↗

User fees, health staff incentives, and service utilization in Kabarole District, Uganda.

OBJECTIVE: To determine the impact of user fees on the utilization of health services in a community-based cost-sharing scheme in Kabarole District, western Uganda. METHODS: Of the 38 government health units that had introduced user-fee financing schemes, 11 were included in the study. Outpatient utilization was assessed as the median number of visits per month before and after cost sharing began. FINDINGS: After the introduction of cost sharing, overall utilization of general outpatient services, assessed by combining the data from all the participating units, dropped by 21.3%. Utilization increased, however, in facilities located in remote areas, while it decreased in those located in urban or semi-urban areas. The increased utilization in remote facilities was considered to be largely attributable to health workers' incentive payments derived from cost-sharing revenues. CONCLUSIONS: Incentive payments led the health workers to offer improved services. Other factors may also have been influential, such as an improved drug supply to health facilities and increased public identification with community projects in remote areas.

Attitude of Health Personnel↗

Do incentives encourage support of clinical quality?

Do financial incentives for executives of health care delivery systems encourage top-down change that supports physicians in making clinical improvements? A new survey suggests quality measures have been incorporated into some incentive programs, but there's considerable room for improvement.

Health Facility Administrators↗

Professional and public attitudes toward incentives for organ donation.

The U.S. faces a widening gap between the need for, and the supply of, transplantable organs. The waiting list for transplants increased 150% in the past decade; last year, about 6,000 people died awaiting a transplant. This need has rekindled debate about the morality and feasibility of using incentives to encourage posthumous organ donation. This Issue Brief explores attitudes of the public and health professionals in the transplant community about using financial and nonfinancial incentives to increase the supply of cadaver organs for transplant.

Attitude of Health Personnel↗

Generous provider incentives deliver dramatic returns.

A stunning success in the use of provider incentives to boost care. A physician incentive program established a decade ago by CA-based Inland Empire Health Plan has turned into a powerhouse for quality improvement. In fact, the approach has worked so well that the plan has now turned its attention to chronic care management, where early evidence suggests that generous bonus payments will produce improvements in clinical outcomes as well as process measures.

Adolescent↗

Annual survey: incentive plans on the rise in hospitals.

Long a fixture in other fields, incentive plans are becoming much more common--and are being received more favorably--in the health care sector. Hospitals are implementing incentive compensation plans at an explosive rate, according to the 1991 Hay Hospital Management/Professional Survey of compensation and benefits data from over 1,200 U.S. hospitals. The survey also looks at compensation's link to organizational performance and gives a list of average base salaries and total cash compensation for a number of health care positions. Learn the latest trends, exclusively in Hospitals.

Data Collection↗

Universal health insurance through incentives reform.

Roughly 35 million Americans have no health care coverage. Health care expenditures are out of control. The problems of access and cost are inextricably related. Important correctable causes include cost-unconscious demand, a system not organized for quality and economy, market failure, and public funds not distributed equitably or effectively to motivate widespread coverage. We propose Public Sponsor agencies to offer subsidized coverage to those otherwise uninsured, mandated employer-provided health insurance, premium contributions from all employers and employees, a limit on tax-free employer contributions to employee health insurance, and "managed competition". Our proposed new government revenues equal proposed new outlays. We believe our proposal will work because efficient managed care does exist and can provide satisfactory care for a cost far below that of the traditional fee-for-service third-party payment system. Presented with an opportunity to make an economically responsible choice, people choose value for money; the dynamic created by these individual choices will give providers strong incentives to render high-quality, economical care. We believe that providers will respond to these incentives.

Aged↗

Predominant methods and issues regarding physician income distribution and incentive compensation plans.

This paper discusses physician income distribution within a group practice setting. In this discussion, factors affecting physician-income generation and distribution are explored, including objectives of incentive programs, overall economics of group practices, methods of distributing income which are most commonly employed, and other issues that affect incentive compensation.

Economics, Medical↗

Costs, payments, and incentives in family planning programs: a review for developing countries.

Anxieties about financing health and family planning programs have grown in recent years, leading to discussions of cost-recovery measures that would raise charges to the consumer. Yet some governments wish to lower cost to encourage contraceptive use, and a few use incentives and disincentives. Data from numerous developing countries are presented on contraceptive cost topics: charges for contraceptive supplies and services, in both public and private sectors, and conversely, payments made to clients and providers to offset costs and to increase contraceptive use. The data show great diversity, and much inconsistency within countries, indicating that the structures of charges, payments, and incentives in many programs could be improved. Ethical considerations are discussed, and guidelines are suggested for developing effective financial policies.

Contraception↗

Marketing to nurses through an incentive program.

Attracting and retaining nursing staff is described as a marketing problem in this article. Nurse administrators can market their institutions to current and potential employees as desirable employers. The nurses in turn present a favorable image of the institution to the community at large if they are satisfied with their jobs. A vehicle to accomplish this task of marketing is the Incentive Career Mobility Plan. Implemented a year ago as a pilot project, this incentive program is achieving its goal of improving employee morale and retention by rewarding self-improvement.

Career Mobility↗

Incentives, reproductive behavior, and integrated community development in Asia.

Surveying experience with incentives, disincentives, and integrated community development approaches in selected Asian countries, this overview defines concepts, notes policy trends, and discusses ethical and legal constraints, psychosocial and socioeconomic aspects, and cultural-environmental influences on reproductive behavior. Major emphasis is on experience reported from China, India, Indonesia, Korea, Philippines, Singapore, and Thailand. Findings to date suggest that, to be successful, programs using incentives, disincentives, and integrated community development approaches will have to be formulated as consistent, clearly defined, and well-communicated policies, responsive to development needs and sensitive to local autonomy and values, with dynamic leadership to obtain and nurture continued policy backing.

Asia↗

Faculty have few incentives for becoming board certified in pharmacotherapy.

A telephone survey of all colleges of pharmacy in the United States (including Puerto Rico) and Canada was conducted to assess the incentives offered for pharmacy practice faculty to become board-certified pharmacotherapy specialists (BCPS). Board certification is not a requirement for employment at any college of pharmacy; however, it plays a part in promotion, tenure, and merit salary increases at several schools. Fewer than half of the schools provide at least partial reimbursement of examination-related expenses. Sixteen have initiated BCPS study groups. We perceive that faculty must have more incentives to take the examination. It may be difficult to change institutional policies regarding merit increases or promotion and tenure, but colleges of pharmacy can do more to decrease the cost burden and to promote study groups within the department.

Canada↗

Payment mechanisms, nonprice incentives, and organizational innovation in health care.

Health care organizational structures support alternative combinations of payment and nonprice incentives for physicians, hospitals, and other providers. Changing perceptions among purchasers of the relative effectiveness of particular mechanisms lead to changes in the market shares held by particular organizational structures. This paper uses principal-agent and transactions cost economics to develop a conceptual matrix for understanding organizational innovation in the health care system. It contrasts the differing incentives in retrospective versus prospective payment mechanisms, arms-length review versus peer review mechanisms for controlling inappropriate utilization, and "free choice of physician" versus selective contracting mechanisms for structuring the basic insurer-provider relationship.

Delivery of Health Care↗

Organ procurement expenditures and the role of financial incentives.

OBJECTIVES: To evaluate the billed charges for organ procurement and to consider the role of financial incentives to encourage organ donation. DESIGN: Observational study. Data were obtained on donor organ acquisition charges from a random sample of kidney, heart, liver, heart-lung, and pancreas transplants. SETTING: The data were based on 28.7% of all transplants performed in the United States in 1988. MAIN OUTCOME MEASURE: Total charges for donor organ acquisition. RESULTS: The median charges (1988 dollars) for donor organs were as follows: kidney, $12,290; heart, $12,578; liver, $16,281; heart-lung, $12,028; and pancreas, $15,400. Since 1983, kidney acquisition charges have increased by 12.9%, heart charges by 64.1%, and liver charges by 61.8%, after adjusting for inflation. Between 9% and 31% of total transplant procedure-specific charges were associated with donor organ acquisition. CONCLUSIONS: There is wide unexplained variation in organ procurement charges. Data on actual costs are required to establish the appropriateness of current charges. Prevailing billing and payment methods should be reevaluated in an effort to address a variety of issues related to reimbursement. Current payment methods may actually contribute to cost inefficiency. Finally, while financial incentives may enhance the efficiency of organ procurement efforts, they will adversely affect the cost-effectiveness of transplantation.

Altruism↗

Mandatory high-risk pooling: an approach to reducing incentives for cream skimming.

Risk-adjusted capitation payments (RACPs) to competing health insurers are an essential element of market-oriented health care reforms in The Netherlands. Crude RACPs are inadequate, especially because they encourage insurers to select against people expected to be unprofitable--a practice called cream skimming. However, implementing improved RACPs does not appear to be straightforward. This paper analyzes an approach that, given a system of crude RACPs, reduces insurers' incentives for cream skimming in the market for individual health insurance, while preserving incentives for efficiency and cost containment. Under the proposed system of Mandatory High-Risk Pooling (MHRP), each insurer would be allowed to periodically predetermine a small fraction of its members whose costs would be (partially) pooled. The pool would be financed with mandatory, flat-rate contributions. The results suggest that MHRP is a promising supplement to RACPs.

Capitation Fee↗

The carrot, the stick and the general practitioner: how have changes in financial incentives affected health promotion activity in general practice?

BACKGROUND: Financial incentives for increasing health promotion activity in primary care, introduced with the 1990 contract for general practitioners, were amended in 1993 and are now focused on cardiovascular disease. Payments for health promotion clinics were abolished and target payments were introduced. AIM: The study aimed to evaluate the effect of the change, in June 1993, in financial incentives for health promotion activity in primary care on the distribution of health promotion payments in two family health services authorities. METHOD: A retrospective study was undertaken in which data from two family health services authorities were used to determine the annual level of health promotion payments per 1000 practice population before and after the contractual amendment. Health promotion clinic payment data were analysed for 78 practices in Bedfordshire Family Health Services Authority and 85 practices in Kensington, Chelsea and Westminster Family Health Services Authority. Changes in health promotion payments were calculated and related to two measures of relative need: all cause standardized mortality ratios, for patients aged 74 years or less, of the electoral ward in which the practice is located; and the Jarman underprivileged area score. High relative need was defined as a standardized mortality ratio of over 100 or more than 25% of the practice population living in electoral wards with a Jarman score of over 30. RESULTS: Health promotion payments were more evenly distributed after the change in June 1993 than before between the two family health services authorities and between general practices. Single-handed practices were carrying out more clinics in 1992 than multi-partner practices and consequently were one of the greatest financial losers as a result of the change. In addition, practices located in electoral wards with high relative needs lost proportionally more than those in electoral wards with lower needs. CONCLUSION: Changes in the general practitioner health promotion contract have created new financial winners and losers. It now appears that health promotion payments are more evenly distributed but that the distribution is unrelated to need or treatment given. More evidence on the effectiveness of health promotion interventions is required before policies aimed at promoting better health through primary care can be fully evaluated.

England↗

Purchasing population health: aligning financial incentives to improve health outcomes.

OBJECTIVE: To review the concept of population health, including its definition, measurement, and determinants, and to suggest an approach for aligning financial incentives toward this goal. DATA SOURCE, STUDY DESIGN, DATA EXTRACTION. Literature review, policy analysis PRINCIPAL FINDINGS: The article presents the argument that a major reason for our slow progress toward health outcome improvement is that there is no operational definition of population health and that financial incentives are not aligned to this goal. Current attempts at process measures as indicators of quality or outcome are not adequate for the task. It is suggested that some measure of health-adjusted life expectancy be adopted for this purpose, and that integrated delivery systems and other agents responsible for nonmedical determinants be rewarded for improvement in this measure. This will require the development of an investment portfolio across the determinants of health based on relative marginal return to health, with horizontal integration strategies across sectoral boundaries. A 20-year three-phase development strategy is proposed, including components of research and acceptance, integrated health system implementation, and cross-sectoral integration. CONCLUSIONS: The U.S. healthcare system is a $1 trillion industry without a definition of its product. Until population outcome measures are developed and rewarded for, we will not solve the twenty-first century challenge of maximizing health outcome improvement for the resources available.

Cost-Benefit Analysis↗