Physician Response to Pay-for-Performance: Evidence From a Natural Experiment

Abstract

This study exploits a natural experiment in the province of Ontario, Canada, to identify the impact of pay-for-performance (P4P) incentives on the provision of targeted primary care services and whether physicians' responses differ by age, size of patient population, and baseline compliance level. We use administrative data that cover the full population of Ontario and nearly all the services provided by primary care physicians. We employ a difference-in-differences approach that controls for selection on observables and selection on unobservables that may cause estimation bias. We implement a set of robustness checks to control for confounding from other contemporaneous interventions of the primary care reform in Ontario. The results indicate that responses were modest and that physicians responded to the financial incentives for some services but not others. The results provide a cautionary message regarding the effectiveness of employing P4P to increase the quality of health care.

Implementation Processes and Pay for Performance in Healthcare: A Systematic Review

“…We identified 15 retrospective cohort studies 30,[32][33][34][35][36][37][38][39][40][41][42][43][44][45] and three cross sectional surveys 15,46,47 related to the inner setting. Studies of the QOF found that larger practices in the UK performed better in the short term, [33][34][35] particularly when examining total QOF points; 37 however, results varied when examining subgroups by condition or location and by indicator.…”

“…), 30 and patient panel size/volume are less clear, with studies reporting conflicting results. 30,43 Findings from Key Informant Interviews. KIs stressed that P4P is just one piece of an overall quality improvement program, with other important factors such as a strong infrastructure and ongoing infrastructure support (particularly with regard to information technology and electronic medical records), organizational culture around P4P and associated measures, alignment/allocation of resources with P4P measures, and public reporting.…”

“…We identified three retrospective cohort studies 29,34,43 and two cross-sectional surveys. 13,49 Studies examining the influence of provider characteristics found no strong evidence that provider characteristics (e.g., gender, age) related to performance in P4P programs.…”

“…13,49 Studies examining the influence of provider characteristics found no strong evidence that provider characteristics (e.g., gender, age) related to performance in P4P programs. 13,29,34,43,45 …”

“…Inner setting Eighteen studies 15,30,[33][34][35][36][37][38][39][40][41][42][43][44][45][46][47][48] examined implementation factors related to the inner setting. Studies found:…”