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Aligning Physician Incentives Doesn’t Do It

My wife Mary and I recently got a series of early morning calls alerting us to the declining health of Mary’s mom, who was in her 90s. She died later that week. We were stricken and so sad, but took comfort that she died with dignity and good care on her own terms, and at her home in San Francisco.

Ten years ago, we received a very different early morning call, about my father.  An otherwise healthy and vigorous 72-year-old, Dad had fallen at home. Presuming he’d had a stroke, paramedics took him to a hospital with a neurosurgery speciality rather than to the university trauma center. That decision proved fatal.

A physician in Seattle at the time, I arrived the next day to find Dad in the intensive care unit on a ventilator. Dad’s head CT revealed a massive intracranial hemorrhage. Dad also had a large, obvious contusion on his forehead.

The following day, the physicians asked to remove Dad from the ventilator.  He died that night. We were profoundly devastated by his death and upset with the care he’d received.

Our family wasn’t interested in blame or lawsuits. We did, however, want answers:  Why hadn’t Dad been treated for a traumatic injury from a fall? Shouldn’t he have had timely surgery to relieve pressure from bleeding? What went wrong?

I’ve spent the last decade searching for answers, for myself and countless others, to questions about how to improve health care.  I’ve had the honor of working with many people pushing health care toward high value, at the Robert Wood Johnson Foundation(RWJF) and elsewhere.

We’ve worked hard to find solutions.  We all get it:  The health care problem is a big, complex one without silver bullet answers. Still, we’ve made incredible progress with efforts like RWJF’s Aligning Forces for Quality Initiative in which community alliances work to improve the value of their health care.

We’re searching for ways to help us all make smarter health care decisions.  We’re helping health care professionals improve and patients and families be more proactive.  We’re exploring the price and cost of care, and ways to automate health care information with technology.

And importantly, we’re working to align the incentives that health care professionals need to support and deliver great care.  We strongly believe that unless we reward great results, we won’t get them.  That means payment reform, with a focus on financial incentives for those who hunt for waste, resolve safety problems, sustain improvement, and, most of all, innovate to save more lives.

But do financial incentives to promote and reward behavior work?


In his book, “Drive: The Surprising Truth about what Motivates Us,” Daniel Pink  emphatically says that all too often they don’t.  Research shows that financial incentives do work – for narrow, routine, mechanistic tasks.  But the more complex the task, the more financial incentives targeted at it fail. In fact, they may even degrade desirable behavior by dulling creativity and inhibiting motivation. Larger rewards can even lead to worse performance.

That’s a problem when we’re trying to solve big complex problems like fixing health care.  But there is hope. And there are motivators more effective than dollars.

Pink suggests we focus instead on what really matters to the people we’re trying to motivate – like autonomy, the ability to direct one’s own life; mastery, the desire to get better at something that matters; and purpose, the chance to serve something larger than ourselves. These three motivators allow human beings to look broadly, get creative, innovate and be energized. That’s the basis of a critique on health care payment reform efforts in a new RWJF report.

And that brings me back to my Dad.  In 2005, several years after he died, several of us at RWJF were travelling the country trying to understand what was happening in health care markets. We were gathering information to develop the Aligning Forces initiative, and that work led me to my hometown. During interviews, one leader volunteered several major problems they were experiencing, including access to some emergency specialty services. High on the list of those services was access to neurosurgery specialty care for emergent but unprofitable craniotomies. That’s that surgery my Dad desperately, urgently needed—the one he didn’t get.

In 2004, a couple of national surveys by the American College of Emergency Physiciansand the American Association of Neurological Surgeons and the Congress of Neurological Surgeons (AANS/CNS) highlighted a growing reluctance by specialty physicians to provide emergency on-call coverage.  Half of neurosurgeons who served on call had limited their call in some way.  One third of them refused to offer craniotomies.

To fix this specialty on-call problem, some like the American Association of Neurological Surgeons advocated for a payment change, a bonus or stipend to surgeons for on-call coverage. But a subsequent 2006 AANS/CNS survey showed that, while stipends might be attractive, they weren’t the solution.

No doubt part of the reason was it took surgeons away from non-emergent, profitable care. That reason though does not sync with the experience we’ve all had with individual compassionate physicians we know. Perhaps instead by putting these surgeons in extremely difficult situations, in trying to force or entice them to do these procedures, we are degrading their sense of control, their autonomy and mastery and, ultimately, their incredible sense of purpose.

I’m going to make a bold assertion:  Until we get these human motivators right in health care, we can try all sorts of complicated, elegant payment models and formulas and still ultimately not get to the goal of sustainable high value. It will always be just over the horizon. Let’s absolutely be smart about incentives in health care, but let’s also get away from talking about simple carrots and sticks. Instead, let’s find the right mix of motivators to promote the creativity we need to get the best care every single time for people who are relying on us, like my Dad.

I believe we can do it. I must believe. Because for me, as you can see, it’s personal.

Michael W. Painter, JD, MD is the senior program officer at the Robert Wood Johnson Foundation.

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  9. Respect, dignity, appreciation, recognition, validation are words many physicians describe as lacking in today’s attitudes toward doctors. Yes, the economics are reflected as well. In the end, you get what you pay for. Just ask yourself, how much more does the nations “best” Cardiothoracic surgeon get paid for doing a complex heart operation, compared to a doctor who just finished training yesterday, performing the same operation? The answer (by third party government payers), nothing. They are both paid the same. Some may think this is fair, others may not. You decide. But most people would believe that after they have worked at a job for 20 years, and perfected their skills, they should be paid more than they were the day they started their job. http://www.RateHospitals.com is monitoring the healthcare industry.

  10. Lemming – am not “demonizing” anyone – my points are fairly straightforward – how much do you “need” to make …

  11. Am well aware of the rigors of training – did the whole nine yards in surgery …. but nor for the money or for the prospect of making more

    As for being treated “fairly” – that is in the eyes of the beholder – for me the question should be how much do we need to make, how much is “enough” – I have yet to see an open honest discussion about that …

  12. you are talking about the past….procedures….all are paid too low….$1100 for a total knee and 90 days of care? $1400 for a bypass by medicare; mri now pays $300 from mediare, etc. the inflated prices like $20,000 for an amputation of a diabetic foot quoted by Obama are untrue. Specialists make a lot for one reason…not they get paid too much….they work hard, and see hundreds of patients, hundreds and hundreds. I wouldn’t do my ortho residency for 5 years again for $1 million a year. Terrible loss of personal time, health, family life, etc. ON call 10 times a month, etc. and you demonize me like others? wow

  13. the training period is about learning perseverance and self-sacrifice and sacrifice of family life….it is unsustainable as a model for a doctor’s whole practice life. the problem with employment is self-starters/hard workers excel, lazy and slow individuals don’t meet goals in a non-incentive system. Incentives are not the problem…. 60-65 year olds need to feel like they need to work for insurance….if not, they are a load on society. lowering the medicare age would incentivize a lot of them to retire early.
    Monetary incentive has satisfied mastery and autonomy part of “running” your own business, etc. There is a combination of capitation—– to ———fee for service that is the answer, in combination with purpose, mastery, autonomy. Pink states: level of income didn’t matter ONLY when a person felt they were treated fairly…when we see new graduates being paid more by hospitals desperate to recruit, while the new recruit cannot produce near as much/work as hard, etc…….there is your setup for not feeling treated fairly. And for those who think specialists are the problem, try doing the residency/torture program for 5-6 years, being on call and both physically and mentally performing day and night on call frequently, working 5 work days a week, taking 2 weeks vacation a year, etc. which is the average for a specialist in rural America…….most cannot and would not put up with being a specialists–its not a great job even with the remuneration—-certainly not now–as we are the demons of medicine. Neurosurgeons like hand surgeons who don’t do replants, and ortho docs who don’t do spine surgery any more, and family docs who don’t deliver babies, and don’t even have splints in office—–are afraid of lawyers, have migrated to procedures that have good success—patients love you when you fix their acl, when you reattach a thumb and it only works fairly well, they now resent you………………the risk, night work, patient unappreciation for less than perfect and fast outcomes, by definition grates against mastery and purpose. The docs who have been rewarded for doing cosmetic day work, very narrow subspecialty care in areas with low risk, great results give an EXAMPLE for the neurosurgeons and hand surgeons to follow. If I’m paid low(ALL Procedures are paid low now….period..think not? I get paid $1100 for a total knee—-less than plumber/a/c/attorney/mechanic for doing their work? You know learning curve to do them well? residency? etc? wow, patients are abhorred when told how much medicare pays us for any procedure) and I get beat up from family, and it disrupts a whole night, where is the reward? One of my opposite effects rules….as payments for procedures have been lowered, then volumes have gone up….why not raise the amount per procedure—through capitation, fee, bundle, whatever the convoluted system insurers MPHs want to design… and ration care based on effectiveness and function of patient? That is what works…..duh—————–but yes specialists need more money than primary care docs, because they train longer, train harder, work harder, etc. than primary care docs….its not rocket science. they are different. period. sorry, I do believe primary care docs are paid too low… but 4.5 day work week? never go to hospital any more? no casting? no delivering babies? come on….its less work!!!! I have seen all the primary care self-pay musculoskeletal patients from our ER for 20 years along with paying patients to pay the bills….yes, my volume is high…primary care docs don’t do near the self-pay work that specialists do in their practices……and specialists are the demons? I think there are no demons, there is a demographic/resource emergency looming, and we have as a side-distraction(albeit noble and worthy goal) of decreasing waste…. in the end, even by cutting out waste…duh, duh, duh we don’t have enough resources for pathology, so elaborate payment schemes to ration care (through politically correct means like demonizing specialists) have to occur. I am not the problem in medicine. Demographics is the problem. Its math.

  14. VERY GOOD POINTS AND I AGREE COMPLETELY.CORPORATE MEDICINE HAS DEMOTED OUR PROFESSION INTENTIONALLY AND FURTIVELY.
    WE ARE NO LONGER PHYSICIANS BUT “PROVIDERS”….MEANWHILE ANYONE WITH A PHD IN BASKET WEAVING IS CALLED DOCTOR.

  15. Frankly, I think you make the case that i have made in my replies here, for me …..

  16. I meant to reply more timely, but was off the grid on vacation. First, Dr. Painter, thank you for sharing your tragic story and of reminding us of the costs (in dollars and/or suffering and grief) of getting it wrong. I view the carrot and stick approach only as a valid approach to a time-limited programmatic approach for changing behavior – such as adopting ePrescribing or EHRs – but of course not as payment reform.

    I am 33 years into my career as a primary care internist, and got my first lesson in payment policy stupidity pre-managed care. In my primary care internal medicine training program I had the good fortune of spend 18 months out of 3 years in outpatient settings, including every day in a primary care HMO setting and pieces of each week in specialty clinics. A derm professor saw a patient concerned that a mole might be a melanoma, and in a few seconds we both knew it was not, and after spending a few minutes educating the patient as to how to identify suspicious lesion – she ended up removing the lesion (took perhaps a minute to do a core biopsy and put in one stitch). My prof explained to me that under exisitng UCR payment policy then – procedures were paid at 100% with no copay to the patient, whereas cognitive care (all the patient needed) had copays and was subject to a deductible. The misaligment there affected docs and patients, and certainly reflected views toward physician / provider work – which was the thinking is of little value, and doing was of tremendous value. And not to slam my procedural colleagues – I should add that new procedures seemed always to generate higher revenues than old ones. Thus, use of a laser to remove suspicious appearing vascular lesions (10 or 15 minutes of provider time) could easily have paid the dermatologist more than a general surgeon doing a cholecystectomy.

    In an invited editorial for the Annals of IM in 2005, I wrote that EMR technology will never be optimized without a “sustainable business case for information management and quality outcomes.” This was not a call for more P4P but rather for payment reform such that payment was fair and aligned with what made societal sense. For example, it has been technically possible since at least 2000 (and probably years before) to create a care delivery model for chronic care that made extensive use of eVisits, proactive monitoring, home devices, etc. – and made visit based care as something that was done only when F2F care was medically necessary or when the patient desired it. Such a model could markedly decrease the costs of managing chronic illness, as well as some acute illnesses. We modeled concept in our primary care practice, and determined that if fully implemented, our incomes would go from the low end of the physician pay scale to negative (our practice like most PCP practices ran on about a 50-60% overhead rate).

    So while we dont do that, I have been doing a variation – which is to “max-pack” visits (address all unmet care opportunities during visits) and to make treatment adjustments via letter, phone or online – effectively cutting visit volume by about 50%.

    My quality scores are mostly excellent, and I am driven not by P4P as we dont really have any. And while people have commented after hearing me present variations of this story that what I am doing should count for eVisit payment – as there is none where I practice – its all talk.

    As you mention – motivation to do the very best you can for each patient should be the driver for excellence in care delivery. Health care payment should not stand in the way of that motivation – it now does.

    And while some descriptions of P4P incentives are nonsensical (I am making this one up – I will pay you $600 for an appendectomy and $630 if you wash your hands first), payment reform that looks towards outcomes but removes the barrier of always requiring a visit, and removes the barrier of payment for doing, but no payment for use / interpretation of existing information makes sense to me.

    Imagine a payment for managing a healthy diabetic for the year. One could set a schedule for guided self-care, regular reporting, proaction and interventions based on lack of understanding of self-care, not reporting sugars as appropriate, etc – as well as judicious use of visits. I believe it would promote innovation in care delivery which hopefully would lead to better results at a lower cost.

  17. Leonard–exactly–thanks for pointing to Ashish’s post–to me that’s yet another story about how the extrinsic incentives have created a dysfunctional environment (the ER world vs. the untainted bike path world)–that warps and deranges the basic wonderful motivations of health professionals. Really fascinating.

  18. Leanord–really excellent points–and precisely the ones we’re trying to make in the RWJF report (see link above–and herehttp://www.rwjf.org/en/research-publications/find-rwjf-research/2013/08/improving-incentives-to-free-motivation.html ) Getting the incentives right is key–and getting them right means making sure the dollars move in the right way to support physician efforts to do the right thing–without, however, letting the incentives–even so-called “aligned ones”–undermine the motivation and drive to find creative ways out of the dysfunction. Great points.

  19. I see this at some great, world-renowned institutions. There’s talk of patient engagement, and the practitioners really want it, but when it comes down to engaging vs. another expensive procedure, the procedure still wins in the allocation of funds.

    Where I do see changes are all strangely timed with the announcement of 30-day readmission penalties and a focus on infections. Important, certainly, but the investment of time and resources is still tied to the expected return, and that ultimately influences how many decisions are made, to the culture of the organization itself.

    In Predictably Irrational, Ariely makes the key distinction between social conventions and transactional ones. We’re more likely to do the right thing when social conventions are in place, but when we start getting paid, the expectations of behavior change.

    Docs are forever feeling the pull of both directions. Changing the incentives to align with the goals of the patient makes this dichotomy easier to navigate.

  20. BTW, Leslie–love the capuchin monkey fairness video-that’s a good one.

  21. Sorry – I still think it goes back to motivation – if one’s motivation is the patient’s health, then one will protest, buck, work to change, etc – the policies that mitigate against it – if that is not one’s motivation, it seems to me there is little difference between a lone ranger and a collaborative setting ….

  22. When you divide by zero you get a whole lot of nothing.

    Keep dreaming.

    I do not seeequally capable people emerging from medical eucation. Today’s new doc is timid and willing to hide under the corporate veil. They wre not responsible.

    In the near future the outcome of a case will be measured against whether or not the policies were followed, and NOT against whether or not the best care was provided.

    Better retain your private physician to care for you rather than to be your survivors’ expert witness.

  23. I am well aware of the monkey “fairness” studies – but that rather begs the question. One could well argue that it is not “fair” that a doc who saves a life by bypassing a blocked coronary artery is paid considerably more than a doc that saves a life by bypassing a blocked colon – but that argument, per se, isn’t set up to answer the question of whether one is paid “too much” or the other “too little” – not to mention how to compare the worth of either procedure to a doc’s keeping a patient from developing one or the other condition in the first place ….

    That is why I think an open public discussion needs to be based on what a doc needs to comfortably take care of one self and one’s family – does one need to make enough to have a Maserati and a second house in the Hamptons? I think some docs might be hard pressed to convince folks they “need” what they are making …
    If we could agree that any doc “deserves” to make enough so that (s)he can support his/her family so (s)he can focus on improving the care of the patient without worrying about finances – then we might actually be able to decide on “salaries” – At that point docs who are in it for the money can split and those in it for patients can go back to work feeling they can focus on them … After all, once baseline needs are met, does any health care professional worth his or her salt need a greater incentive than improving the health of the patient?

    Unless you can put a pricetag on a person’s life, it is foolish, IMO to discuss this in terms of what a service is “worth” – so let us, instead base it on what a provider needs to be able to focus on those lives without having to worry about his/her own … Frankly, i think that is why we are having so much difficulty with this “incentive” routine – In a field where it is frankly rather absurd, IMO, to talk about which life saving technique. e.g., is “worth” more, ISTM the discussion of $$$, in any format, as a suitable incentive is rather, not to put too fine a point on it, bonkers ….

  24. They are unwilling to be the headline defendant when they are not appreciated and were not in charge of the case.

    Everyone meddling in the care of the patient should have their own equal coverage for the medmal system and be equally accountable.

  25. hi Mike, just to clarify: I think we can find ways to give clinicians that motivating sense of automony in tomorrow’s healthcare system, such as helping them tailor care to a patient’s individual circumstances rather than focusing excessively on following guidelines. But it won’t be the exact type of autonomy that physicians used to have. As we focus on nuturing medicine’s human capital, it’s worth thinking about how to navigate these changes in autonomy. (which is what you’re doing; thank you!)

    In response to Aquifer & the question of how much physicians need to make: there’s what people need to make and then there’s how fair the pay feels, which is framed by how much others around you are making. (Prob a factor in considering primary care.)
    This video of capuchin monkeys rejecting unequal pay is worth seeing; a sense of fairness is deeply embedded within most people!
    http://www.youtube.com/watch?v=gOtlN4pNArk

  26. MD-I think you pretty much capture the point here–and the reservoir of frustration caused by existing extrinsic incentives in health care. That loss of respect is more than just a feeling-it’s responding to facts. And you’re right doctors did not create that toxic incentive environment or cause these problems. We do need doctors and other health professionals to be as creative and innovative as possible to help get us out of the dysfunction–that’s why we better understand how to free their inherent powerful motivation to do that kind of innovative work.

  27. Leslie–thanks for this note. I think you are absolutely correct. It cannot just be about health professional autonomy and purpose. Certainly, there are many other considerations to balance–including most importantly patient and family–and their autonomy–they are the most important player in these stories. Still, we clearly have not paid sufficient attention so fart to the things that actually motivate physicians and other health professionals to innovate toward better and better care experiences with and for those patients.

  28. Yeah – the ones who cannot/will not collaborate and those in it for the money will leave and a whole new class of collaborating, less $$ concerned, but no less capable folks will take over the profession – and that, for me, would be a breath of fresh air ….

  29. Great comment! – I know this is a sticky wicket, but I think there are gender issues involved, in more ways than one, in both marriage and medicine …

    As mentioned in the article, as salaried residents, the issue of financial “incentives” was moot – are we to assume that residents are therefor insufficiently motivated, or that their motivation is all the dough they’ll get later?

    And as Pink points out – once basic financial needs are met with “sufficient” funds, any more oft gets in the way. Frankly i think if physicians are on salary the profession will be one in which the motivation for entering will “return” to a desire to take care of patients and not pad the pocketbook – I would love to see a discussion among physicians as to how much they, personally, really “need” to make – if lives are priceless, can we really talk about how much it is “worth” to save one ….

  30. “Autonomy is going to be a tricky one when it comes to physicians. It’s doable but tricky because we are in the midst of a massive culture shift, in which physicians will have to do more shared decision-making with patients, as well as with other professionals. (This shift could be considered similar to the shift in the husband-wife dynamic that has occurred over the past 50 years, no?)”

    Marriage rate is at all-time low.

    Make that “the remaining physicians will have to do more……”

  31. GREAT post and terrific comments. I read Daniel Pink’s Drive last fall & have been wondering ever since why intrinsic motivation isn’t discussed more often as part of healthcare reform. Thank you for bringing this issue to the fore!

    Autonomy is going to be a tricky one when it comes to physicians. It’s doable but tricky because we are in the midst of a massive culture shift, in which physicians will have to do more shared decision-making with patients, as well as with other professionals. (This shift could be considered similar to the shift in the husband-wife dynamic that has occurred over the past 50 years, no?)

    Although I do think most physicians want to do the right thing for patients, many of them are used to and comfortable with a model in which they get to quickly decide what that right thing is…as opposed to negotiating a mutually acceptable path forward with the patient, and maybe also accessing decision support. (I am routinely approached by families who are unhappy with the way doctors have gotten pissed when the family asked too many questions.)

    Still, I think it’s possible to create better working conditions that allow physicians to engage in the hard, meaningful, rewarding work of medicine. Less nickle and diming is definitely needed. I sincerely hope to never be bugged about productivity again as I make efforts in the visit trying to address thorny topics such as a possible dementia diagnosis or a declining life trajectory. In general, a little stress in the workplace helps one perform optimally, but too much stress and hassle is a bad thing.

  32. Congress, CMS and all of the other do-gooders have created impediments to safe, efficacious, and creative care.

    In essence, they have injected a relenting chronic disease on the health care professionals and health care system, sapping energy, while enriching those who have nothing to do with medical care.

    Implosion soon, but the US Government is shameless. Vote them all out of office.

  33. Docs are mad as hell for the loss of respect for them. All the systems from EHR to CPOE have been inflicted by outside forces, essentially rounding up docs into corralls where they can be controlled and fed and contained.

    That does not create an atmosphere for the altruism of old.

    If you want the doc to show up and save your bacon at 3 in the morning you better treat him better than you do now.

    Stop stealing my profession and calling it reform.

    Physicians never were the original cause of any of these problems.

    They arose from governemnt commoditizing something that was indiviually customized for each patient. But they did not want to pay the price.

    The government also fell into the durable medical equipment business and the home health business, essentially squandering billions for political returns and no change in outcomes.

    The government took over the system.

    All we here from government is how bad we are. The doc is leaving the system.

  34. Jeff – “THey spend their entire training period sheltered from the “incentives” issue by salaried employment …..”

    Hmmm – seems to me the answer is in there ….

  35. Steve – i was about to reply with much the same observation – unless you have a lot of neurosurgeons available in an area, asking one to cover “all the time” simply isn’t reasonable – One wonders if it isn’t possible to train ER docs to be able to do “simple cranies” – burr holes, e.g.. That wouldn’t solve the problem presented here – a massive intra cranial bleed – but epi- and acute sub- durals could be handled – This of course opens up another potential can of turf war worms – but if the focus is indeed the patient, it would seem to me that could/should be bridged …

  36. IJ-I think you’re right–that past efforts and current attempts to address major health care dysfunction still have blunted rather than freed the inherent motivations of our doctors and other health professionals–with all sorts of negative results–that impact the profession and importantly our patients and families.

  37. Thanks, Steve–that’s really helpful to understand. Would love it if we set up care so that creative physicians like yourself and other health professoinals felt free and motivated to make sure those kinds of procedures were available every single time for patients and families that desperately need them, when they need them. Thanks so much for the note.