Monday, July 28, 2008

Like Moths Drawn to a Light

Once again, Pay for Performance measures have been demonstrated to be a miserable bureaucratic failure.

But what's the bureaucrats' response? Why, PAY THEM MORE and MAKE MORE MEASURES to make it work, of course!
Rosenthal cautioned that studies finding little quality impact so far "have nothing to do with overturning the theory of pay-for-performance. It can be explained by the way in which these programs have been implemented, and at the top of the list is that the size of the bonus is too small."

Maximum quality incentives average 9% of plan payments, according to a Nov. 2, 2006, New England Journal of Medicine study by Rosenthal, but most physicians average less than a 5% bonus. By contrast, under a British P4P plan that was rolled out in 2004, physicians can more than double their income by achieving high scores on 149 quality indicators.
Don't they get it? THIS DOESN'T WORK! Worse yet, people can get RICH scheming this system: just build a little algorithm to assure everyone gets a test each time they're seen, (performed, of course, under the guise of a "quality initiative") whether they need it or not, and voila' - you're rich! You can name a TON of ways to game the system because each of these "measures" turns the intent of "quality" into a PROFIT motive for doctors and hospitals.*

When it comes to pay and the inevitable declining revenues in the Medicare National Bank, doctors (and hospitals) are like moths: they're drawn to the brightest light with this month's payment rationing scheme. And here's the thing...

...the brighter the light, the more moths will flock there.


* Well, not really. Actually Medicare withholds a portion of payments to doctors and hospitals first, and only after completing 85% or more of the "quality measures" will they ante up the full payment amount. (It's like training a dog: "Sit, Fido, sit. Stay. Staaayyy. Good, dog! Here's your treat!")

Image reference.


Andrew_M_Garland said...

Here is how an incentive system didn't work to find software defects.

"The CEO announced an innovative program to motivate employees and boost the quality of their logistics software. For every bug (defect) found by a tester and fixed by a programmer, both would get $10." ... More

Rogue Medic said...

One of the problems is that they do not look at actual quality, but surrogates.