QUALITY/POLICY: P4P get official in Businessweek, no less

So in a remarkable bit of futurism, only 8 years after Greg Schmid invented the concept at IFTF (well, we end up calling it performance-based reimbursement, but it’s the same thing as P4P), Businessweek has noticed and Pay for Performance has gone mainstream.

I’m still looking for someone to find an earlier citation of an equivalent term or concept–I still can’t believe that we allowed a non-healthcare economist to invent the term!  And with reference to the Gianfranco post from yesterday…. Greg came into work every day for 5 years and always said to me "How come they named the football team you support after the President’s daughter?"

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  1. I was very pleased to find this web-site.I wanted to thanks for your time for this wonderful read!! I definitely enjoying every little bit of it and I have you bookmarked to check out new stuff you blog post.

  2. All of the major insurers will be rolling out “pay for peformance” systems with publicly available ratings and possibly even higher copays for those physicians who do not meet their criteria.
    Please watch– the word “efficient” or an equivalent will always be used– this is a not so thinly veiled reference to the fact that they will reward the “cheapest” physicians– i.e. those who utilize the least services.
    Complications occur– some are clearly preventable and perhaps compensation for these should be modified. But the implication above that complications some how are viewed by doctors as a way to line their pockets has no basis in fact.
    Penalizing doctors over outcomes– which usually have many variables– will futher lead to access problems as doctors would have another reason to avoid complicated patients and problems.

  3. I have to weight in on the nursing shortage. I have been an RN/Nurse Practitioner for 30 years. It has to be said LOUDLY that nursing is a great profession men and women. While nurses always come up as one the most trusted professions in the poll we continue to suffer from lack of media support. I was furious that when Nurse Abby on the TV show ER wanted to further her education she went to medical school to become and MD rather than to graduate school to be an NP. This media message (and there are numerous other examples) clearly sends the message to young viewers that being and MD is better than being an RN. This is just nonsense. I cannot tell you how many times I have met people (usually females) who when they went high school guidance counselor and said they wanted to be a nurse were told “girls don’t have to be nurses anymore.” They were then sent into other fields of study and some after years of being biologist finally went back to college to become a nurse and fulfill their dream.
    The developed world is taking away nurses from the resource poor countries that are literally dying from AIDS and other infectious disease. If we continue to let this happen the vast majority of nations will become destabilized. Nations won’t be able to defend themselves. They will become terrorist targets. Presently 10% of the Russian work force is HIV positive. Some nations still do not acknowledge AIDS exists in their country. The Sri Lankan health minister does not have ANY AIDS infrastructure set up and sees no need to create one. However, I helped friend, ho is from Columbo, sneak AIDS treating drugs into the county.
    No other profession takes care and cures people like nurses. We are the largest health care provider in the world. The need for more college educated nurses is critical. I just don’t see why the pubic doesn’t get it. The current nursing population is aging. We are retiring or frankly dying. If the health care system reverts to using non-college educated “med techs” people will die or be seriously harmed. The notion that RNs simply fluff pillow and give bed baths has to be dispelled. We are the 24/7 provider of health care and monitor and every patient and save lives on a daily (if not hourly;) basis.
    Richard S. Ferri, PhD, ANP, ACRN, AAHIVS, FAAN

  4. Matthew,
    I’ve been writing about pay for non performance in health care for almost 30 years. When patients get nosocomial infections because doctors don’t wash their hands and when patients are misdiagnosed, both hospitals and docs are paid to try to fix the problems they created. Only in American health care.

  5. Ron,
    Some people get depressed and hallucinate. Those people need help. And some people can’t function properly w/o meds. (I’m sure that you’re not a scientologist, but I want to point out that those people think that all of psychiatry is basically a fascist plot.)
    I can imagine that there are crooked doctors.
    I’m not sure how that affects P4P. The question is less about the inputs and more about the quality of the output. If you can get a better result doing it a different way, why shouldn’t you?

  6. Abby,
    You ask, //Please elaborate on the “noncovered expense” portion of your reply. It seems to me that employers might push insurers to rewrite the contracts. So what’s standard now could change.//
    Many times people have procedures done one way that is a covered expense on their insurance when there is an alternative procedure that would be a noncovered expense. It has been reported that some doctors will do a procedure that is a noncovered expense but then bill the procedure as a covered expense (a different procedure code) to get paid.
    I do believe some people get sad or depressed. I have a new client that begged the doctor for depression medication and the doc finally gave in and gave it to her. She was fired from her job so she was depressed. Yes, I think the mental health industry is calling normal sadness that people have, Depression. That is not to say that some people really do have “depression” and do need help.

  7. There is already pay for performance in terms of paying Doctors for meeting “quality criteria”. The problem is that the health care providers are setting the criteria and determining how it gets measured. (Or they own the “outside organization” that measures Quality, like NCQA). What that means is that physician performance skews toward this criteria. They have more motivation to diagnose and follow “mainstreamed” diseases like diabetes, asthma, or cardiac problems than to screen for or work with “orphan diseases”. In simple terms, provider-controlled quality standards encourage doctors to “teach to the test”. Giving bonuses for this is a sign of an increasing problem, not a solution.
    By the way, I don’t think giving bonuses is works well in other industries, either. The discretionary power associated with allocations of bonuses shores up personal “turf”, and the scramble for bonuses motivates people to steal credit and try to hide the efforts of others. It also increases cynicism and irrational responses in employees because the bonus system conflicts with the “team” messages. Upper management makes bonuses off their ability to squeeze free extra labor out of those below. The idea of “extra” performance also muddies the boundaries of a person’s job description: at what point does consistent “bonus” performance become an expectation as the “norm” for the job? And what about the managerial imperative to always under-report performance so the people who report to them will always have an incentive to work harder? Between the political maneuvering and the crazy-making, turnover has probably increased.
    I would like to see people rewarded for putting in the extra effort, but I don’t think performance pay does that. I think finding a way to transparently record those efforts and then moving people into the right job description with an appropriate salary would accomplish the same thing. If someone’s big effort makes the company millions of dollars, then perhaps she should be helping to direct the organization. Stock in the company also gives people an overall sense of ownership, though I’m not sure that even works unless a lot effort goes into keep people educated on how their work relates to the over all financial picture of the company.
    Going back to physicians: it seems to me that pay for performance would just tap into the current corporate dysfunctions. If physicians have an extraordinary patient satisfaction rate (without pre-screening those patients for who would express the most satisfaction), then that physician should be recognized and positioned for further success.

  8. Ron,
    As much as I wish that there were blood tests for serious mental illness, there aren’t yet, but these diseases are real.
    Are you saying that major depression is not a real disease? (I am agnostic on the question of whether ADHD is overdiagnosed and too many kids are on ritalin.)
    Please elaborate on the “noncovered expense” portion of your reply. It seems to me that employers might push insurers to rewrite the contracts. So what’s standard now could change.

  9. The problem with insurance paying bonuses because of outcomes is pretty simple, it would be a noncovered expense. Insurance will pay 5 times more for a covered procedure and will not pay 80% less for a noncovered expense. We see it all the time.
    The general population can’t tell the difference between schizophrenia and depression. Today when a woman is dumped by her husband, some docs put her on medication. Doctors put kids on Ritlin and say there is a chemical imbalance and they never ran a test to prove their gut feelings. These Docs are like Mr. Spock with a Vulcan mind melt. You should see all of the people on prescription medication just because they were fired from some employer, it’s crazy.

  10. Ron,
    I don’t think that pay for performance requires single-payer.
    Matthew, I saw that article. Has anyone tried that with mental health? I’m thinking of the really catastrophically serious illnesses like schizophrenia. Of course, most of those people are in some sort of public system. I read that Tenn Care is trying to discourage the use of Zyprexa. This sounds penny wise, pound foolish.
    If there were some sort of performance aspect, possibly tied to being able to hold down a regular job of some sort, then some of these short-term cost cutting solutions which are actually harmful to patients might be avoided.
    Of course, that would presume a level of altruism for crazy people that probably doesn’t exist in the general population.

  11. I don’t think we are going to give doctors and hospitals bonuses for anything. Senator Grassley can play with government programs like Medicare because we should try anything with that program and all of it’s problems and fraud.
    You are calling soccer the wrong name. Football is a completely different sport in the US. There are some Tampa people who are going to correct that problem and start calling soccer it’s real name. You have probably heard of them.
    “Tampa Bay Buccaneers owner Malcolm Glazer informed Manchester United’s remaining shareholders Tuesday that he controlled 98 percent of the shares and passed the 97.6 percent threshold needed to make a compulsory purchase of all the shares in the famous soccer team in England, according to the Associated Press. Manchester United fans fear increased ticket prices because Glazer borrowed much of the buyout amount.” — Reported by Tampa Tribune
    The problem with a single payer system is that it needs Democratic support. Here in Florida the Democrats are so broke that Governor Jeb Bush called the Democratic Party “Pathetic.” The Democrats have a Senator here named Nelsen but polls suggest even Democrats want to replace him. By 2008 the Republicans will probably have over 70 Senators so it’s going to be a long wait for single payer.
    On July 4th, a big day here in America, Newsweek has a good article, they will report:
    “Given a GOP field that lacks a standout contender, Bush “would automatically be the one to beat” were he to enter, says Mac Stipanovich, a former Bush campaign manager. He’s a popular governor who has embarked on pathbreaking reforms in such areas as education and Medicaid, and presided over a robust Florida economy. And he’s embraced by the GOP’s conservative base. So is Bush planning a run? Though he has repeatedly denied it, “that decision remains to be made,” says one of the confidants. Another, who declined to be named so as not to jeopardize his relationship with Bush, believes Bush will end up going for it. “I think the national party will call on him,” says this adviser, “and it will be tough to resist.”
    —Arian Campo-Flores and Lynn Waddell
    © 2005 Newsweek, Inc.
    Governor Jeb Bush loves tax free HSAs and has just made them available as an option for state employees. Jeb said, “Floridians will be wise with their HSA balances.”