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The effect of some incentives on the work performance of psychiatric patients at a rehabilitation workshop.

Five experimental incentive conditions were compared with a control condition in terms of their effect on work performance. Each of the six groups studied had a standard four-week baseline period (Block 1) consisting of an attendance payment, followed by a four-week experimental period (Block 2). Whereas all patients in the Control and Feedback groups produced less during Block 2, only two patients in the remaining four groups failed to improve. An analysis of variance indicated that Social Reinforcement, Piece Rate, Piece Rate plus Social Reinforcement, and Pay Increase plus Social Reinforcement were significantly superior to the Control and Feedback conditions.

Adult↗

Financial incentives and drug spending in managed care.

This study estimates the impact of patient financial incentives on the use and cost of prescription drugs in the context of differing physician payment mechanisms. A large data set was developed that covers persons in managed care who pay varying levels of cost sharing and whose physicians are compensated under two different models: independent practice association (IPA)-model and network-model health maintenance organizations (HMOs). Our results indicate that higher patient copayments for prescription drugs are associated with lower drug spending in IPA models (in which physicians are not at risk for drug costs) but have little effect in network models (in which physicians bear financial risk for all prescribing behavior).

Adult↗

Market incentives, plan choice, and price increases.

The Federal Employees Health Benefits Program (FEHBP) has attracted considerable interest for its ability to control health care costs. We examine the impact of the FEHBP's maximum dollar contribution on incentives to select low-cost plans and the growth in insurance premiums over time. Unless the maximum dollar contribution is pegged to a low-price plan, few enrollees select such plans. Moreover, premiums rise at least five percentage points per year faster among plans below this fixed subsidy level than they do in plans above it. Our results have important implications for the design of similar market-based approaches.

Choice Behavior↗

Transmission of financial incentives to physicians by intermediary organizations in California.

Many U.S. physicians participate in provider-sponsored organizations that act as their intermediaries in contracting with managed care plans, particularly where capitation contracts are used. Examining a survey of 153 intermediary entities in California, we trace the cascade of financial incentives from health plans through physician organizations to primary care physicians. Although the physician organizations received the vast majority (84 percent) of their revenues through capitation contracts, most of the financial risk related to utilization and costs was retained at the group level. Capitation of primary care physicians was common in independent practice associations (IPAs), but payments typically were restricted to primary care services. Thirteen percent of medical groups and 19 percent of IPAs provided bonuses or withholds based on utilization or cost performance, which averaged 10 percent of base compensation.

California↗

Paying for quality: providers' incentives for quality improvement.

Paying health care providers to meet quality goals is an idea with widespread appeal, given the common perception that quality of care in the United States remains unacceptably low despite a decade of benchmarking and public reporting. There has been little critical analysis of the design of the current generation of quality incentive programs. In this paper we examine public reports of paying for quality over the past five years and assess each of the identified programs in terms of key design features, including the market share of payers, the structure of the reward system, the amount of revenue at stake, and the targeted domains of health care quality.

Managed Care Programs↗

Quality incentives: the case of U.K. general practitioners.

The United Kingdom is implementing major changes to the national contract for general practitioners (GPs). A central plank of the new arrangements is an ambitious scheme to reward high-quality care. Each general practice will be scored on 146 performance indicators according to the measured quality of care it delivers, and its accumulated score will determine the magnitude of the quality payment it receives. About 18 percent of practice earnings will be at risk. This paper describes the incentive scheme, discusses its potential benefits and risks, and draws out the implications for evaluation.

Physician Incentive Plans↗

[Financial incentives for employees as part of a policy to upgrade care in a public hospital in Volta Redonda, Rio de Janeiro State, Brazil].

The authors present and analyze six years of regular and steady application of an institutional evaluation policy based on financial incentives in a public hospital in Volta Redonda, Rio de Janeiro State, Brazil, as a part of the hospital's administrative modernization policy. This type of policy is considered implicitly capable of developing a sequence of strategic wagers: (1) release of financial resources for payment of bonuses; (2) creation of an operationally feasible and sensitive evaluation instrument; (3) creation of adequate management mechanisms to improve evaluation policy; (4) employee adherence to the hospital upgrading policy based on the bonus system; and (5) maintenance of the effects of evaluation policy over time. The article discusses the "degree of success" of each of these wagers in an attempt to portray possible gains throughout the process, while also identifying inherent difficulties in such a policy.

Brazil↗

What drives change? Barriers to and incentives for achieving evidence-based practice.

To bridge the gap between scientific evidence and patient care we need an in-depth understanding of the barriers and incentives to achieving change in practice. Various theories and models for change point to a multitude of factors that may affect the successful implementation of evidence. However, the evidence for their value in the field is still limited. When planning complex changes in practice, potential barriers at various levels need to be addressed. Planning needs to take into account the nature of the innovation; characteristics of the professionals and patients involved; and the social, organisational, economic and political context.

Diffusion of Innovation↗

A transcription incentive program for diagnostic imaging.

Unhappy with a five-day report turnaround time in 1989, managers of Rhode Island Hospital's diagnostic imaging department began to investigate transcription incentive programs and created a model for the organization based on the research. The authors provide implementation details in this article and report that after 15 months, the organization is experiencing increased productivity, decreased costs, motivated staff and improved report turnaround!

Costs and Cost Analysis↗

Motivating employees: an incentive program.

Motivating employees is a challenging and critical task for all managers--no matter what the field. Robert Barczewski, M.B.A., and Linda Michelson describe how a successful incentive program at the Washington University School of Medicine was developed.

Academic Medical Centers↗

Incentives and cost containment in primary care physician reimbursement.

The goal of capitation is to place gatekeepers at financial risk for the services the deliver. However, third party payers should provide gatekeepers with some type of protection against random and systematic risk transfer. Gatekeeper physicians' other alternative is to reduce this risk on their own by actively marketing services to healthier individuals and creating barriers to care for their sicker patients. Thus, the proper balance of risk transfer will result in the most cost-efficient, quality gatekeeper networks. However, even with the right balance of risk transfer, capitation may provide incentive for some physicians to withhold necessary services to further increase their profit margins-making quality of care a key concern. Thus, practice guidelines should be developed to ensure quality is not affected. These guidelines afford explicit criteria on how gatekeepers should respond in specific clinical situations.

Capitation Fee↗

Quality management: implementing incentive plans.

Many prominent health care organizations that have embraced the concepts of total quality management have not altered their traditional philosophical approaches of managing compensation through base pay administration. How exactly does one incent individuals to participate in the total quality management process through their paycheck? This article offers some specific models that human resource managers may use to accomplish this goal.

Employee Incentive Plans↗

Medicare and Medicaid programs; requirements for physician incentive plans in prepaid health care organizations--HCFA. Final rule.

This final rule amends the regulations established by a March 27, 1996, final rule with comment period. The regulations govern physician incentive plans operated by Federally-qualified health maintenance organizations and competitive medical plans contracting with the Medicare program, and certain health maintenance organizations and health insuring organizations contracting with the Medicaid program. As explained in the March 27 rule, the provisions of this final rule will also have an effect on certain entities subject to the physician referral rules in section 1877 of the Social Security Act.

Capitation Fee↗

Aligning incentives using risk-sharing arrangements.

Most managed care arrangements do not properly align provider and HMO incentives and thus unintentionally promote conflicting care management patterns. But appropriate risk-sharing arrangements encourage HMOs and providers to agree on the best methods to achieve member satisfaction; high-quality, cost-effective care; and healthy profits. Quality- and cost-based risk-sharing arrangements withhold a certain portion of providers' payments for placement in a risk pool fund. Providers are penalized financially for poor quality and unsatisfactory cost performance; providers are financially rewarded with risk pool funds for the cost-efficient delivery of high-quality health care. Percent-of-premium or capitation risk-sharing arrangements divide member premiums among the parties to the risk-sharing arrangement based on how much financial risk each party is willing to assume for providing care. The risk of controlling variations in cost is assumed by providers, thus minimizing HMOs' financial exposure. Inpatient case rate risk-sharing arrangements pay providers a flat rate for uncomplicated cases. Such arrangements can improve the relationship between HMOs and providers by giving providers primary control over case management and benefits HMOs by reducing their utilization review activities.

Capitation Fee↗

Bringing managed care incentives to Medicare's fee-for-service sector.

The Health Care Financing Administration (HCFA) could work with eligible physician organizations to generate savings in total reimbursements for their Medicare patients. Medicare would continue to reimburse all providers according to standard payment policies and mechanisms, and beneficiaries would retain the freedom to choose providers. However, implementation of new financial incentives, based on meeting targets called Group-Specific Volume Performance Standards (GVPS), would encourage cost-effective service delivery patterns. HCFA could use new and existing data systems to monitor access, utilization patterns, cost outcomes and quality of care. In short, HCFA could manage providers, who, in turn, would manage their patients' care.

Capitation Fee↗

If you build a solid incentive plan, resource-savings will come.

Proper financial incentives for physicians can often mean the difference between success and failure for health systems with efficiency driven capitated contracts. Tying physician bonuses to specific behaviors that generate efficiency and quality is an increasingly popular way to achieve positive financial and clinical output.

Budgets↗

A physician incentive compensation program in a staff model HMO.

A physician incentive program was developed at an established staff model HMO. Differential compensation, which augments a salary scale that reflects years of experience and service, is based on productivity and utilization of laboratory and x-ray services. Productivity is objectively measured on a relative-value-scale for time utilized for a range of types of visits. Laboratory and x-ray utilization is measured against recent historical practice patterns. A case mix adjustment stratifies for age in the adult patient encounters.

Clinical Laboratory Techniques↗