FINAL EXAM: PROVIDER PAYMENT AND MANAGING CARE /PERFORMANCE INDICATORS

Pay for . Performance - PHYSICIAN

Pay for Performance (P4P) refers to financial incentives aligned with the practice of evfdence-based clinical care and is based on incentives rather than being risk­ based. P4P programs began in HMOs, but are now widely used by many types of payers as well as Medicare. Medicare's shared savings program is also a form of P4P, but because it combines physician and hospital payment, ic is discussed later in the chapter.

P4P programs typically apply to PCPs, but may involve specialists- as well. The focus with P4P arrangements is on the following factors:

• Common conditions • Conditions for which physicians vary in how they treat cases • Conditions for which there are good evidence-based medical guidelines • A payer's ability to measure performance using data it has on hand,

such as medical and pharmacy claims data

For example, patients with diabetes should have their eyes checked regularly because these individuals have a higher than average risk of blindness. The payer can use its claims data to see if diabetic patients are visiting an eye doctor to have the test performed. In some cases, data from focused PCP medical chart reviews may also be used for P4P purposes.

The financial incentive for providers is usually based on target percentage com- .

pliance with several such measures. The higher the compliance rate, the higher the incentive paymen�. There will also be a minimum compliance rate below which there is no incentive payment. P,hysician P4P programs usually look at the performance of groups of physicians because there are usually only a small num­ber of measures that any individual physician may be able to report. Exceptions include common process measures for certain individual hysicians in primary care - for example, immunization rates.

PAY FOR PERFORMANCE - FACILITY

There is some overlap between P4P programs focused on hospitals and those focused on physicians, at least in regard to the clinical conditions under review, but the actual measures tend to be different. P4P programs for hospitals measure results for individual hospitals or health systems, whereas physician programs usually look at the performance of groups because there are usually only a small number of measures that any individual physician may be able to report. The exception ro this scenario is Medicare, in which process measures (e.g., did the physician write the prescription, even if the patient did not fill it) for individual physicians are used. P4P programs are dependent on a variety of data collection approaches, which can lead to inaccuracies if they are not managed properly. Consequendy, leading payers maintain openness to improvements in methodologies for data collection.

Unfortunately, with the exception of California, the programs currently in place vary-an issue that creates difficulty for providers that are required to report data to multiple programs.

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