Pay-for-performance as a method to establish the business case for quality.

One of the major reasons providers give for not implementing promising quality-enhancing interventions (QEI) is that no "business case" for quality has been made. This article clarifies the concepts of the business case for quality and the related economic case for quality and identifies the perspectives of the various actors in health care financing, production, and consumption decisions. A methodology to evaluate the business case for quality from the perspective of payers and providers is presented. The article then uses implemented QEIs to show how a pay-for-performance (P4P) program can alter the business cases for payers and providers. Specifically, the P4P programs described in this article allow a provider to implement a QEI with the financial alignment of the payer in order to achieve financial and non-financial benefits. In some cases, providers and payers may be able to establish P4P programs providing net benefits for both parties.

Prognostic gene expression signatures can be measured in tissues collected in RNAlater preservative.

Gene expression signatures have the ability to serve in both prognostic and predictive capacities in patient management. The use of RNA as the starting material and the lability of this analyte, however, dictate that tissues must be snap-frozen or stored in a solution that can maintain the integrity of the RNA. We compared pairs of snap-frozen and RNAlater preservative-suspended tissue from 30 such paired lymph node-negative breast tumors and 21 such paired Dukes' B colon tumors. We assessed the correlation of gene expression profiles and prediction of recurrence based on two prognostic algorithms. Tissues stored in RNAlater preservative generated expression profiles with excellent correlation (average Pearson correlation coefficients of 0.97 and 0.94 for the breast and colon tumor pairs, respectively) compared to those produced by tissues that were snap-frozen. The correlation in the prediction of recurrence was 97% and 95% for the breast and colon tumor pairs, respectively, between these two types of tissue handling protocols. This novel finding demonstrates that prognostic signatures can be obtained from RNAlater preservative-suspended tissues, an important step in bringing gene expression signatures to the clinic.

Physician reactions to quantitative individual performance reports.

The purpose of this study was to learn how primary care physicians experienced the introduction and evolution of an individual physician pay-for-performance program. Thirty primary care physicians participated in audiotaped focus groups 13 and 26 months after beginning the program. Transcribed audiotapes were used to group comments into themes. Ten thematic groups were identified. Practitioners reviewed their profiles but found it difficult to use them to change behaviors. They were concerned about the data accuracy, the influence of specialists and patients on their "scores," and, less, the validity of quality measures. They described ways the program changed their practices and consideration of cost, quality, and satisfaction. There were important concerns about the influence of pay-for-performance programs on professionalism. Primary care physicians were skeptical of this pay-for-performance program. On the other hand, physicians described positive influences on making improvements in quality, satisfaction, and practice efficiency.

Return on investment in pay for performance: a diabetes case study.

With purchasers' increasing frustration with healthcare costs, more innovative approaches to performance-based reimbursement are in demand. Establishing pay-for-performance programs has become a popular strategy for reorienting payments from rewarding volume to rewarding adherence to performance measures. However, while performance on quality measures has improved, no reports exist about the return on investment (ROI) of pay-for-performance programs. This article compares the overall costs of implementing and maintaining a pay-for-performance program with the resulting cost trend savings for diabetes care for a health maintenance organization's (HMO's) population. The program was a five-year partnership (2000-2004) between a health plan and an independent practice association (IPA) for the HMO product. It reported performance scores on quality, patient satisfaction, and practitioner efficiency at the individual physician level. Physician performance reporting began in 1999, and payment for that performance began in 2002. The cost of the program was 1,150,000 dollars yearly. Savings for diabetes alone in 2003, the first post-intervention year, were 1,894,471dollars. Second-year (2004) savings against the two-year rolling trend were 2,923,761 dollars. For 2003, the resulting ROI was 1.6:1, and for 2004, it was 2.5:1. To our knowledge, this article is the first report of a positive ROI for an HMO-based pay-for-performance program, and it begins to answer the question of whether the investment in such programs is worth the effort.