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India: population: shocking results; monetary incentives.

Addressing a conference of Parliament members on population and development in New Delhi, Prime Minister Indira Gandhi was reported to have informed the gathering that results of India's latest census "shocked us." The census counted a total national population of 683 million. It was 11 million more than officially anticipated. In her speech, Mrs. Gandhi was also reported to have reiterated that her government is totally committed to "voluntary family planning" and "firmly against compulsion." J.R.D. Tata, chairman of the Family Planning Foundation of India, proposed that the government raise monetary incentives for citizens voluntarily opting for vasectomy and tubectomy. He suggested that the present Rs. 200 for vasectomy and tubectomy be upped to Rs. 5000. He made the proposal in a call to the government to increase its outlay for the family planning program.

Asia↗

Financial incentives and drug spending in managed care.

Pharmaceutical costs have been rising dramatically since 1995, growing 16.6% in 1998 alone. This rate of increase is more than four times that of all health care spending. Employers, managed care organizations and consumers are looking anew for ways to stem these rising costs, without denying patients effective care. Therefore, this Issue Brief is especially timely because it investigates how patient copayments and financial incentives for physicians affect drug spending in managed care.

Cost Sharing↗

The best-laid incentive plans.

Hiram Phillips couldn't have been in better spirits. The CFO and chief administrative officer of Rainbarrel Products, a diversified consumer-durables manufacturer, Phillips felt he'd single-handedly turned the company's performance around. He'd only been at Rainbarrel a year, but the company's numbers had, according to his measures, already improved by leaps and bounds. Now the day had come for Hiram to share the positive results of his new performance management system with his colleagues. The corporate executive council was meeting, and even CEO Keith Randall was applauding the CFO's work: "Hiram's going to give us some very good news about cost reductions and operating efficiencies, all due to the changes he's designed and implemented this year." Everything looked positively rosy--until some questionable information began to trickle in from other meeting participants. It came to light, for instance, that R&D had developed a breakthrough product that was not being brought to market as quickly as it should have been--thanks to Hiram's inflexible budgeting process. Then, too, an employee survey showed that workers were demoralized. And customers were complaining about Rainbarrel's service. The general message? The new performance metrics and incentives had indeed been affecting overall performance--but not for the better. Should Rainbarrel revisit its approach to performance management? Commentators Stephen Kaufman, a senior lecturer at Harvard Business School; compensation consultant Steven Gross; retired U.S. Navy vice admiral and management consultant Diego Hernandez; and Barry Leskin, a consultant and former chief learning officer for Chevron Texaco, offer their advice in this fictional case study.

Budgets↗

Medicare launches financial incentive program to reward hospital quality care.

The pay-for-performance movement received a boost in July when Department of Health and Human Services Secretary Tommy Thompson announced a new Medicare pilot project, which starts October 1, that will use financial incentives to encourage hospitals to provide high-quality care for 35 measures in five clinical areas.

Aged↗

Disability beneficiaries who work and their experience under program work incentives.

This research examines the return to work by Disability Insurance beneficiaries who were first entitled to benefits in 1980-81 and who were originally selected to be interviewed in the New Beneficiary Survey. To facilitate an examination of actual labor-force participation by beneficiaries, information on work and participation in program work incentives was collected from their claims folders. The analysis shows that approximately 10 percent of disability beneficiaries work during their initial period of benefit entitlement. About 80 percent are granted a trial work period, and over 70 percent of those granted trial work successfully complete it. More than half of them, however, were not successful in leaving the rolls through their work effort. In fact, benefit terminations due to work occurred for fewer than 3 percent of all beneficiaries in the cohort; approximately one-third of them had returned to the rolls by the end of the period under study. Beneficiaries most likely to make a work attempt were young and had a high level of education. Those with a high Social Security benefit amount were less likely to make a work attempt.

Adult↗

State public policy: the impacts of Oklahoma's physician incentive programs.

The enactment of Medicare and Medicaid created a sudden and significant increase in demand for physician services in Oklahoma. As a response, the Oklahoma Legislature established the Physician Manpower Training Commission in 1975. The intent was to provide incentives for graduating physicians to remain in Oklahoma, especially in rural areas. This analysis examines the retention rates experienced during the 25-year period of 1976-2001. It is observed that 82% of program physicians are currently practicing in Oklahoma. This retention proportion compares to only 36% for National Health Service Corps physicians who were obligated to practice in Oklahoma. Additionally, Oklahoma has experienced a 67% retention proportion in rural areas. During this period, 633 physicians have received an estimated dollar 19 million in loans and scholarships. This is an average of dollar 30,000 per recipient. In return, each of these physicians will create 34 jobs and almost dollar 1 million of annual income.

Databases, Factual↗

Capped organizations gain edge with care management, incentives.

California medical groups and IPAs are more likely than physician organizations in other states to use recommended care management processes for treating patients with chronic illnesses primarily because they have a greater number of external incentives to improve quality.

California↗

Effects of a 6-month incentive-based exercise program on adherence and work capacity.

The purpose of the study was to evaluate the effect of behavioral management techniques on exercise adherence linked to improvements in work capacity and maximal oxygen consumption (VO2max). One hundred thirty-seven participants in six different worksites on a university campus (five experimental and one comparison site) completed 6 months of a minimally supervised, incentive-based endurance exercise program. All participants in the experimental group contracted to engage in at least four bouts of 30 min of verified aerobic exercise within a prescribed target heart rate range each week for the duration of the program. Forty dollars deposited at the beginning of the program served as a response cost that could be lost as a result of failure to fulfill the weekly contracts. Individuals in the comparison group participated in a similar 6-month program but without the contracts and response cost strategies. Weekly adherence for both groups was strictly defined as verified fulfillment of all four bouts of exercise. Adherence for the experimental group was 97% by this definition, and adherence for the comparison group was 19% (P less than 0.01). VO2max increased 2.6% (P less than 0.01), and treadmill test time increased 16% (P less than 0.01) in the experimental group after the 6-month program, with no significant changes in the comparison group. Recovery heart rates at 2 and 4 min post-exercise were significantly lower at 6 months in the experimental group but not in the comparison group. These data provide evidence that adherence to a 6-month endurance exercise program can be improved significantly through the use of well conceived behavior management strategies.(ABSTRACT TRUNCATED AT 250 WORDS)

Adult↗

Reform debate must address appropriate capital incentives.

In the broad debate over health care reform, the issue of how to regulate hospital capital spending is being touched on lightly. Many options exist--from incentives built into a national payment mechanism to market-driven plans.

Capital Expenditures↗

Value-based insurance design: aligning incentives to bridge the divide between quality improvement and cost containment.

Rising costs and suboptimal clinical quality have spawned efforts to redesign healthcare benefit packages. Momentum has gathered behind 2 trends; the first, represented by disease management initiatives and pay-for-performance programs, focuses on the quality of care, and uses tools to manage patient health. The second trend, represented by increased patient cost sharing and consumer-driven health plans, focuses on the cost of care and uses financial incentives to alter patient and provider behavior. These 2 trends create a conflict for the patient in that disease management programs--designed to improve patient self-management--aim to enhance compliance with specific clinical interventions, while rising copayments create financial barriers that discourage the use of these recommended services. When patients are required to pay more for their healthcare, they buy less, even if the intervention is potentially lifesaving. Thus, the challenge for purchasers is to devise benefit packages that incorporate a range of features that complement each other in the effective and efficient delivery of care while explicitly avoiding the unwanted negative clinical effects associated with increased cost sharing.

Cost Control↗

Cost savings in a hospital clinical laboratory with a pay-for-performance incentive program for supervisors.

A pay-for-performance incentive program for clinical laboratory supervisors was developed and implemented at Brigham and Women's Hospital (Boston, Mass). It provides monetary rewards to personnel who directly produce cost savings in their area of responsibility. This reward system is new to the hospital laboratory but is commonly used in industry. Substantial true cost savings over and above previously established stringent budgets were achieved, 11% of which was returned to first-line supervisors in the form of a bonus. The program expanded the scope of professionalism for supervisors to include fiscal management.

Cost Control↗

[Apropos of the article by L.B. Shefer and A.D. Dzhunusbekov "The concept of a material incentive system based on the end results of carrying out antituberculous measures"].

The proposed material incentive system can find its practical application to increase the effectiveness of antituberculosis activities. In this connection, it seems advisable to turn from the quantitative indicators of measures taken by the antituberculosis service to the qualitative ones. Nevertheless, the given concept contains a number of disputable issues to be thoroughly analysed from the viewpoint of the antituberculosis service staffing both in urban and rural areas. The first results of the activities undertaken in different territories in the course of an economic experiment including their evaluation, are presented.

Humans↗

Provider-patient relations and treatment choice in the era of fiscal incentives: the case of the end-stage renal disease program.

Debates about the extent to which patients can and should participate in medical decision making take on new urgency as cost-containment efforts give patients more financial incentives. The Health Care Financing Administration's recent proposal to enable dialysis patients to "price shop" aroused consternation among nephrologists. A working seminar elucidated their fears about professional incomes and about increased patient autonomy.

Centers for Medicare and Medicaid Services, U.S.↗