Pay-for-Performance Research:  How to Learn What Clinicians and Policy Makers Need to Know

Pay-for-performance has become increasingly common in health care. According to recent surveys, almost 100 pay-for-performance initiatives nationwide are now sponsored by a variety of health plans, employer coalitions, and government purchasers that are intended to improve the quality of care provided.¹

However, the rationale for pay-for-performance comes almost entirely from experience with incentives in other industries. Only 9 randomized controlled trials (RCTs) of pay-for-performance have been reported in the literature.² Even these studies are not clearly applicable to current pay-for-performance because they all focus on performance for a single indicator or a single aspect of care (eg, preventive care), whereas most current pay-for-performance initiatives use multiple indicators for multiple conditions and types of care.¹ Moreover, most studies have important flaws in reporting, such as the failure to note the market share of the organization offering the incentive in the practices of the providers being studied. Because pay-for-performance programs have targeted both individual clinicians and clinical organizations such as hospitals, medical groups, and nursing homes, the collective term “provider” is used herein to refer to all potential parties.