Can Money Buy Quality? Physician Response to Pay for Performance

Publication Date: December 2005

Publisher: Center for Studying Health System Change

Author(s): Thomas Bodenheimer; Jessica H. May; Robert A. Berenson

Research Area: Health

Type: Brief

Abstract:

While pay for performance (P4P) has created a nationwide buzz among health plans, physicians and hospitals, most P4P initiatives are still on the drawing board, according to findings from the Center for Studying Health System Change’s (HSC) 2005 site visits to 12 nationally representative communities. HSC focused on performance-based payment for physicians, finding that only two HSC communities—Orange County, Calif., and Boston—have significant physician P4P programs. In the other 10 communities, where almost no physicians have received quality-related payments to date, physician attitudes about P4P ranged from skeptical to hostile. P4P, a concept best suited to larger physician groups, may be difficult to implement in markets dominated by small physician practices. In spite of substantial barriers to initiating performance-related payment for physicians, most large health plans and Medicare are planning P4P programs.