A new look at physicians' responses to financial incentives: Quality of care, practice characteristics, and motivations.

There is considerable controversy about what causes (in)effectiveness of physician performance pay in improving the quality of care. Using a behavioral experiment with German primary-care physicians, we study the incentive effect of performance pay on service provision and quality of care. To explore whether variations in quality are based on the incentive scheme and the interplay with physicians' real-world profit orientation and patient-regarding motivations, we link administrative data on practice characteristics and survey data on physicians' attitudes with experimental data. We find that, under performance pay, quality increases by about 7pp compared to baseline capitation. While the effect increases with the severity of illness, the bonus level does not significantly affect the quality of care. Data linkage indicates that primary-care physicians in high-profit practices provide a lower quality of care. Physicians' other-regarding motivations and attitudes are significant drivers of high treatment quality.

Plastic Surgeons and Equity: Are Merit-Based Incentive Payment System Scores Impacted by Minority Patient Caseload?

BACKGROUND: The Centers for Medicare and Medicaid Services introduced the Merit-based Incentive Payment System (MIPS) in 2017 to extend value-based payment to outpatient physicians. The authors hypothesized that the MIPS scores for plastic surgeons are impacted by the existing measures of patient disadvantage, minority patient caseload, and dual eligibility. METHODS: The authors conducted a retrospective cohort study of plastic surgeons participating in Medicare and MIPS using the Physician Compare national downloadable file and MIPS scores. Minority patient caseload was defined as nonwhite patient caseload. The authors evaluated the characteristics of participating plastic surgeons, their patient caseloads, and their scores. RESULTS: Of 4539 plastic surgeons participating in Medicare, 1257 participated in MIPS in the first year of scoring. The average patient caseload is 85% white, with racial/ethnicity data available for 73% of participating surgeons. In multivariable regression, higher minority patient caseload is associated with a lower MIPS score. CONCLUSIONS: As minority patient caseload increases, MIPS scores decrease for otherwise similar caseloads. The Centers for Medicare and Medicaid Services must consider existing and additional measures of patient disadvantage to ensure equitable surgeon scoring.

Association of Primary Care Physician Compensation Incentives and Quality of Care in the United States, 2012-2016.

BACKGROUND: Physician compensation incentives may have positive or negative effects on clinical quality. OBJECTIVE: To assess the association between various physician compensation incentives on technical indicators of primary care quality. DESIGN: Cross-sectional, nationally representative retrospective analysis. PARTICIPANTS: Visits by adults to primary care physicians in the National Ambulatory Medical Care Survey from 2012-2016. We analyzed 49,580 sampled visits, representing 1.45 billion primary care visits. MAIN MEASURES: We assessed the association between 5 compensation incentives - quality measure performance, patient experience scores, individual productivity, practice financial performance, or practice efficiency - and 10 high-value and 7 low-value care measures as well as high-value and low-value care composites. KEY RESULTS: Quality measure performance was an incentive in 22% of visits; patient experience scores, 17%; individual productivity, 57%; practice financial performance, 63%; and practice efficiency, 12%. In adjusted models, none of the compensation incentives were consistently associated with individual high- and low-value measures. None of the compensation incentives were associated with high- or low-value care composites. For example, quality measure performance compensation was not significantly associated with high-value care (visits with quality incentive, 47% of eligible measures met; without quality incentive, 43%; adjusted odds ratio [aOR], 1.02; 95% confidence interval [CI], 0.91 to 1.15) or low-value care (aOR, 0.99; 95% CI, 0.82-1.19). Physician compensation incentives that might be expected to increase low-value care did not: patient experience (aOR for low-value care composite, 0.83; 95% CI, 0.65-1.05), individual productivity (aOR, 1.03; 95% CI, 0.88-1.22), and practice financial performance (aOR, 1.05; 95% CI, 0.81-1.36). CONCLUSION: In this retrospective, cross-sectional, nationally representative analysis of care in the United States, physician compensation incentives were not generally associated with more or less high- or low-value care.

Plastic Surgeon Financial Compensation-Incentivization Models in Surgical Care Delivery: The Past, Present, and Future.

BACKGROUND: Surgeons are critical for the success of any health care enterprise. However, few studies have examined the potential impact of value-based care on surgeon compensation. METHODS: This review presents value-based financial incentive models that will shape the future of surgeon compensation. The following incentivization models will be discussed: pay-for-reporting, pay-for-performance, pay-for-patient-safety, bundled payments, and pay-for-academic-productivity. Moreover, the authors suggest the application of the congruence model-a model developed to help business leaders understand the interplay of forces that shape the performance of their organizations-to determine surgeon compensation methods applicable in value-based care-centric environments. RESULTS: The application of research in organizational behavior can assist health care leaders in developing surgeon compensation models optimized for value-based care. Health care leaders can utilize the congruence model to determine total surgeon compensation, proportion of compensation that is short term versus long term, proportion of compensation that is fixed versus variable, and proportion of compensation based on seniority versus performance. CONCLUSION: This review provides a framework extensively studied by researchers in organizational behavior that can be utilized when designing surgeon financial compensation plans for any health care entity shifting toward value-based care.

Physician Incentive Compensation Plans in Academic Medical Centers: The Imperative to Prioritize Value.

The emphasis on clinical volume in physician compensation plans has diminished professional vitality in academic medical centers and increased the cost of health care. Physician incentive compensation plans that focus on clinical volume can distort clinical encounters and fail to incorporate the professionalism and intrinsic motivators of clinicians. We assert herein that physician incentive compensation plans should reward clinical value (quality/cost) rather than clinical volume. The recommended change is compelled by the tenets of medical professionalism, the need to cultivate meaning in clinical practice, and the urgent financial and moral imperatives to improve health outcomes and reduce cost. The design of physician incentive compensation plans should incorporate accurate and valid measures of quality and cost, behavioral economic considerations, transparency and equity, prospective assessment of the impact on key outcomes, and flexible elements that encourage innovation and preserve fidelity to unique practice circumstances. Physicians should be recognized in compensation plans for enhancing the value of care, inspiring and educating the future clinical workforce, and improving public health through discovery.

Current Interventional Radiology-Related Benchmarked Clinical Quality Measures Are Less Likely to be "Capped" Than Diagnostic Radiology Clinical Quality Measures.

In the merit-based incentive payment system (MIPS), quality measures are considered topped out if national median performance rates are ≥95%. Quality measures worth 10 points can be capped at 7 points if topped out for ≥2 years. This report compares the availability of diagnostic radiology (DR)-related and interventional radiology (IR)-related measures worth 10 points. A total of 196 MIPS clinical quality measures were reviewed on the Center for Medicare and Medicaid Services MIPS website. There are significantly more IR-related measures worth 10 points than DR measures (2/9 DR measures vs 9/12 IR measures; P = .03), demonstrating that clinical IR services can help mixed IR/DR groups maximize their Center for Medicare and Medicaid Services payment adjustment.

Current and Future Status of Merit-Based Incentive Payment Systems.

The Quality Payment Program was established by the Medicare Access and CHIP Reauthorization Act (MACRA) legislation in response to repeated efforts to create a permanent so-called doc fix in response to the failures of the sustainable growth formula. This article examines the history leading up to MACRA, the current pathways associated with the Quality Payment Program, and future expectation both from the Centers for Medicare and Medicaid Services, stakeholders, and patients.

Association Between Patient Social Risk and Physician Performance Scores in the First Year of the Merit-based Incentive Payment System.

Importance: The US Merit-based Incentive Payment System (MIPS) is a major Medicare value-based payment program aimed at improving quality and reducing costs. Little is known about how physicians' performance varies by social risk of their patients. Objective: To determine the relationship between patient social risk and physicians' scores in the first year of MIPS. Design, Setting, and Participants: Cross-sectional study of physicians participating in MIPS in 2017. Exposures: Physicians in the highest quintile of proportion of dually eligible patients served; physicians in the 3 middle quintiles; and physicians in the lowest quintile. Main Outcomes and Measures: The primary outcome was the 2017 composite MIPS score (range, 0-100; higher scores indicate better performance). Payment rates were adjusted -4% to 4% based on scores. Results: The final sample included 284 544 physicians (76.1% men, 60.1% with ≥20 years in practice, 11.9% in rural location, 26.8% hospital-based, and 24.6% in primary care). The mean composite MIPS score was 73.3. Physicians in the highest risk quintile cared for 52.0% of dually eligible patients; those in the 3 middle risk quintiles, 21.8%; and those in the lowest risk quintile, 6.6%. After adjusting for medical complexity, the mean MIPS score for physicians in the highest risk quintile (64.7) was lower relative to scores for physicians in the middle 3 (75.4) and lowest (75.9) risk quintiles (difference for highest vs middle 3, -10.7 [95% CI, -11.0 to -10.4]; highest vs lowest, -11.2 [95% CI, -11.6 to -10.8]; P < .001). This relationship was found across specialties except psychiatry. Compared with physicians in the lowest risk quintile, physicians in the highest risk quintile were more likely to work in rural areas (12.7% vs 6.4%; difference, 6.3 percentage points [95% CI, 6.0 to 6.7]; P < .001) but less likely to care for more than 1000 Medicare beneficiaries (9.4% vs 17.8%; difference, -8.3 percentage points [95% CI, -8.7 to -8.0]; P < .001) or to have more than 20 years in practice (56.7% vs 70.6%; difference, -13.9 percentage points [95% CI, -14.4 to -13.3]; P < .001). For physicians in the highest risk quintile, several characteristics were associated with higher MIPS scores, including practicing in a larger group (mean score, 82.4 for more than 50 physicians vs 46.1 for 1-5 physicians; difference, 36.2 [95% CI, 35.3 to 37.2]; P < .001) and reporting through an alternative payment model (mean score, 79.5 for alternative payment model vs 59.9 for reporting as individual; difference, 19.7 [95% CI, 18.9 to 20.4]; P < .001). Conclusions and Relevance: In this cross-sectional analysis of physicians who participated in the first year of the Medicare MIPS program, physicians with the highest proportion of patients dually eligible for Medicare and Medicaid had significantly lower MIPS scores compared with other physicians. Further research is needed to understand the reasons underlying the differences in physician MIPS scores by levels of patient social risk.

Association of Clinician Health System Affiliation With Outpatient Performance Ratings in the Medicare Merit-based Incentive Payment System.

Importance: Integration of physician practices into health systems composed of hospitals and multispecialty practices is increasing in the era of value-based payment. It is unknown how clinicians who affiliate with such health systems perform under the new mandatory Centers for Medicare & Medicaid Services Merit-based Incentive Payment System (MIPS) relative to their peers. Objective: To assess the relationship between the health system affiliations of clinicians and their performance scores and value-based reimbursement under the 2019 MIPS. Design, Setting, and Participants: Publicly reported data on 636 552 clinicians working at outpatient clinics across the US were used to assess the association of the affiliation status of clinicians within the 609 health systems with their 2019 final MIPS performance score and value-based reimbursement (both based on clinician performance in 2017), adjusting for clinician, patient, and practice area characteristics. Exposures: Health system affiliation vs no affiliation. Main Outcomes and Measures: The primary outcome was final MIPS performance score (range, 0-100; higher scores intended to represent better performance). The secondary outcome was MIPS payment adjustment, including negative (penalty) payment adjustment, positive payment adjustment, and bonus payment adjustment. Results: The final sample included 636 552 clinicians (41% female, 83% physicians, 50% in primary care, 17% in rural areas), including 48.6% who were affiliated with a health system. Compared with unaffiliated clinicians, system-affiliated clinicians were significantly more likely to be female (46% vs 37%), primary care physicians (36% vs 30%), and classified as safety net clinicians (12% vs 10%) and significantly less likely to be specialists (44% vs 55%) (P < .001 for each). The mean final MIPS performance score for system-affiliated clinicians was 79.0 vs 60.3 for unaffiliated clinicians (absolute mean difference, 18.7 [95% CI, 18.5 to 18.8]). The percentage receiving a negative (penalty) payment adjustment was 2.8% for system-affiliated clinicians vs 13.7% for unaffiliated clinicians (absolute difference, -10.9% [95% CI, -11.0% to -10.7%]), 97.1% vs 82.6%, respectively, for those receiving a positive payment adjustment (absolute difference, 14.5% [95% CI, 14.3% to 14.6%]), and 73.9% vs 55.1% for those receiving a bonus payment adjustment (absolute difference, 18.9% [95% CI, 18.6% to 19.1%]). Conclusions and Relevance: Clinician affiliation with a health system was associated with significantly better 2019 MIPS performance scores. Whether this represents differences in quality of care or other factors requires additional research.

The impact of the diabetes management incentive on diabetes-related services: evidence from Ontario, Canada.

Financial incentives have been introduced in several countries to improve diabetes management. In Ontario, the most populous province in Canada, a Diabetes Management Incentive (DMI) was introduced to family physicians practicing in patient enrollment models in 2006. This paper examines the impact of the DMI on diabetes-related services provided to individuals with diabetes in Ontario. Longitudinal health administrative data were obtained for adults diagnosed with diabetes and their family physicians. The study population consisted of two groups: DMI group (patients enrolled with a family physician exposed to DMI for 3 years), and comparison group (patients affiliated with a family physician ineligible for DMI throughout the study period). Diabetes-related services was measured using the Diabetic Management Assessment (DMA) billing code claimed by patient's physician. The impact of DMI on diabetes-related services was assessed using difference-in-differences regression models. After adjusting for patient- and physician-level characteristics, patient fixed-effects and patient-specific time trend, we found that DMI increased the probability of having at least one DMA fee code claimed by patient's physician by 9.3% points, and the probability of having at least three DMA fee codes claimed by 2.1% points. Subgroup analyses revealed the impact of DMI was slightly larger in males compared to females. We found that Ontario's DMI was effective in increasing the diabetes-related services provided to patients diagnosed with diabetes in Ontario. Financial incentives for physicians help improve the provision of targeted diabetes-related services.

Association between specialist compensation and Accountable Care Organization performance.

OBJECTIVE: To determine if Medicare Shared Savings Program Accountable Care Organizations (ACOs) using cost reduction measures in specialist compensation demonstrated better performance. DATA SOURCES: National, cross-sectional survey data on ACOs (2013-2015) linked to public-use data on ACO performance (2014-2016). STUDY DESIGN: We compared characteristics of ACOs that did and did not report use of cost reduction measures in specialist compensation and determined the association between using this approach and ACO savings, outpatient spending, and specialist visit rates. PRINCIPAL FINDINGS: Of 160 ACOs surveyed, 26 percent reported using cost reduction measures to help determine specialist compensation. ACOs using cost reduction in specialist compensation were more often physician-led (68.3 vs 49.6 percent) and served higher-risk patients (mean Hierarchical Condition Category score 1.09 vs 1.05). These ACOs had similar savings per beneficiary year (adjusted difference $82.6 [95% CI -77.9, 243.1]), outpatient spending per beneficiary year (-24.0 [95% CI -248.9, 200.8]), and specialist visits per 1000 beneficiary years (369.7 [95% CI -9.3, 748.7]). CONCLUSION: Incentivizing specialists on cost reduction was not associated with ACO savings in the short term. Further work is needed to determine the most effective approach to engage specialists in ACO efforts.

Can Pay-for Performance Incentive Levels be Determined Using a Cost-Effectiveness Framework?

BACKGROUND: Healthcare payers in the United States are increasingly tying provider payments to quality and value using pay-for-performance policies. Cost-effectiveness analysis quantifies value in healthcare but is not currently used to design or prioritize pay-for-performance strategies or metrics. Acute ischemic stroke care provides a useful application to demonstrate how simulation modeling can be used to determine cost-effective levels of financial incentives used in pay-for-performance policies and associated challenges with this approach. METHODS AND RESULTS: Our framework requires a simulation model that can estimate quality-adjusted life years and costs resulting from improvements in a quality metric. A monetary level of incentives can then be back-calculated using the lifetime discounted quality-adjusted life year (which includes effectiveness of quality improvement) and cost (which includes incentive payments and cost offsets from quality improvements) outputs from the model. We applied this framework to an acute ischemic stroke microsimulation model to calculate the difference in population-level net monetary benefit (willingness-to-pay of $50 000 to $150 000/quality-adjusted life year) accrued under current Medicare policy (stroke payment not adjusted for performance) compared with various hypothetical pay-for-performance policies. Performance measurement was based on time-to-thrombolytic treatment with tPA (tissue-type plasminogen activator). Compared with current payment, equivalent population-level net monetary benefit was achieved in pay-for-performance policies with 10-minute door-to-needle time reductions (5057 more acute ischemic stroke cases/y in the 0-3-hour window) incentivized by increasing tPA payment by as much as 18% to 44% depending on willingness-to-pay for health. CONCLUSIONS: Cost-effectiveness modeling can be used to determine the upper bound of financial incentives used in pay-for-performance policies, although currently, this approach is limited due to data requirements and modeling assumptions. For tPA payments in acute ischemic stroke, our model-based results suggest financial incentives leading to a 10-minute decrease in door-to-needle time should be implemented but not exceed 18% to 44% of current tPA payment. In general, the optimal level of financial incentives will depend on willingness-to-pay for health and other modeling assumptions around parameter uncertainty and the relationship between quality improvements and long-run quality-adjusted life expectancy and costs.