Document Detail


SETTING PAY FOR PERFORMANCE TARGETS: DO POOR PERFORMERS GIVE UP?
MedLine Citation:
PMID:  22302418     Owner:  NLM     Status:  Publisher    
Abstract/OtherAbstract:
We examine the effect of a health plan's pay for performance incentives on the percentage of outpatient drug prescriptions that are filled with generic rather than brand-name drugs in physicians' practices in an established physician network - the generic prescription rate (GPR). The financial reward was based on the performance of the entire network, but the network implemented rewards at the practice level. Practice-level rewards were awarded on an all-or-nothing basis if the GPR met or exceeded specialty-specific targets that increased each year. Although that design gave the practices a strong incentive to meet the target, practices performing far below the target might 'give up', costing the network its reward. Using a partial adjustment model, we estimate that in the absence of pay for performance, the average equilibrium value of GPR was 58.3%. We estimate that GPR would be maximized if the target were set at 77%. The GPR-maximizing target would induce an improvement in average GPR from 58.3% to 65.8% or 7.5 percentage points. When the target is set above 80%, practices with equilibrium GPR below 58.3% will 'give up' in the sense that they will not improve relative to their equilibrium value. Copyright © 2012 John Wiley & Sons, Ltd.
Authors:
Bryan Dowd; Roger Feldman; William Nersesian
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Publication Detail:
Type:  JOURNAL ARTICLE     Date:  2012-2-2
Journal Detail:
Title:  Health economics     Volume:  -     ISSN:  1099-1050     ISO Abbreviation:  -     Publication Date:  2012 Feb 
Date Detail:
Created Date:  2012-2-3     Completed Date:  -     Revised Date:  -    
Medline Journal Info:
Nlm Unique ID:  9306780     Medline TA:  Health Econ     Country:  -    
Other Details:
Languages:  ENG     Pagination:  -     Citation Subset:  -    
Copyright Information:
Copyright © 2012 John Wiley & Sons, Ltd.
Affiliation:
Division of Health Policy and Management, School of Public Health, University of Minnesota, USA. dowdx001@umn.edu.
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