Paul Levy is the President and CEO of Beth Israel Deconess Medical
Center in Boston. Paul recently became the focus of much media
attention when he decided to publish infection rates at his hospital,
despite the fact that under Massachusetts law he is not yet required to
do so. For the last year and a half he has blogged about his
experiences in an online journal, Running a Hospital,
one of the few blogs we know of maintained by a senior hospital
executive. Today he gives his take on pay for performance.
This is the next chapter in my Wednesday is Student Day series. Rocky, a medical student, asks below: "What is your take on pay for performance, and will it be integrated into BIDMC?"
My
economics professors in college set forth a series of theories and
formulas that described the functioning of the free market. We all knew
that this formulation was unrealistic, in that most markets are
imperfect. There is often "friction" between parties in a marketplace
that result in imbalances between supply and demand, that result in
uneven knowledge between and among buyers and sellers, or that
otherwise gets in the way of an economically efficient equilibrium
condition.