The Effect of Pay‐for‐Performance in Nursing Homes: Evidence from State Medicaid Programs

Objective

Pay-for-performance (P4P) is commonly used to improve health care quality in the United States and is expected to be frequently implemented under the Affordable Care Act. However, evidence supporting its use is mixed with few large-scale, rigorous evaluations of P4P. This study tests the effect of P4P on quality of care in a large-scale setting—the implementation of P4P for nursing homes by state Medicaid agencies.

Data Sources/Study Setting

2001–2009 nursing home Minimum Data Set and Online Survey, Certification, and Reporting (OSCAR) datasets.

Study Design

Between 2001 and 2009, eight state Medicaid agencies adopted P4P programs in nursing homes. We use a difference-in-differences approach to test for changes in nursing home quality under P4P, taking advantage of the variation in timing of implementation across these eight states and using nursing homes in the 42 non-P4P states plus Washington, DC as contemporaneous controls.

Principal Findings

Quality improvement under P4P was inconsistent. While three clinical quality measures (the percent of residents being physically restrained, in moderate to severe pain, and developed pressure sores) improved with the implementation of P4P in states with P4P compared with states without P4P, other targeted quality measures either did not change or worsened. Of the two structural measures of quality that were tied to payment (total number of deficiencies and nurse staffing) deficiency rates worsened slightly under P4P while staffing levels did not change.

Conclusions

Medicaid-based P4P in nursing homes did not result in consistent improvements in nursing home quality. Expectations for improvement in nursing home care under P4P should be tempered.     

An Examination of Pay‐for‐Performance in General Practice in Australia

Objective

This study examines the impact of Australia''s pay-for-performance (P4P) program for general practitioners (GPs). The voluntary program pays GPs A$40 and A$100 in addition to fee-for-service payment for providing patients recommended diabetes and asthma treatment over a year, and A$35 for screening women for cervical cancer who have not been screened in 4 years.

Design

Three approaches were used to triangulate the program''s impact: (1) analysis of trends in national claims for incentivized services pre- and postprogram implementation; (2) fixed effects panel regression models examining the impact of GPs'' P4P program participation on provision of incentivized services; and (3) in-depth interviews to explore GPs'' perceptions of their own response to the program.

Results

There was a short-term increase in diabetes testing and cervical cancer screens after program implementation. The increase, however, was for all GPs. Neither signing onto the program nor claiming incentive payments was associated with increased diabetes testing or cervical cancer screening. GPs reported that the incentive did not influence their behavior, largely due to the modest payment and the complexity of tracking patients and claiming payment.

Implications

Monitoring and evaluating P4P programs is essential, as programs may not spark the envisioned impact on quality improvement.     

A Note on the Comparative Statics of Pay‐for‐Performance in Health Care

Pay‐for‐performance (P4P) is a widely implemented quality improvement strategy in health care that has generated much enthusiasm, but only limited empirical evidence to support its effectiveness. Researchers have speculated that flawed program designs or weak financial incentives may be to blame, but the reason for P4P's limited success may be more fundamental. When P4P rewards multiple services, it creates a special case of the well‐known multitasking problem, where incentives to increase some rewarded activities are blunted by countervailing incentives to focus on other rewarded activities: these incentives may cancel each other out with little net effect on quality. This paper analyzes the comparative statics of a P4P model to show that when P4P rewards multiple services in a setting of multitasking and joint production, the change in both rewarded and unrewarded services is generally ambiguous. This result contrasts with the commonly held intuition that P4P should increase rewarded activities. Copyright © 2015 John Wiley & Sons, Ltd.     

Effects of Changes in Diabetes Pay‐for‐Performance Incentive Designs on Patient Risk Selection

Objective

Taiwan''s National Health Insurance (NHI) Program implemented a Diabetes Pay‐for‐Performance Program (P4P) based on process‐of‐care measures in 2001. In late 2006, that P4P program was reformed to also include achievement of intermediate health outcomes. This study examined how the change in design affected patient risk selection.

Designs/Study Populations

Study populations were identified from a 2002 to 2003 period (Phase 1) and a 2007 to 2008 period (Phase 2), spanning pre‐ and postimplementation of reforms in the P4P incentive design. Phase 1 had 74,529 newly enrolled P4P patients and 215,572 non‐P4P patients, and Phase 2 had 76,901 newly enrolled P4P patients and 299,573 non‐P4P patients. Logistic regression models were used to estimate the effect of changes in design on P4P patient selection.

Principal Findings

Patients with greater disease severity and comorbidity were more likely to be excluded from the P4P program in both phases. Furthermore, the additional financial incentive for patients'' intermediate outcomes moderately worsened patient risk selection.

Conclusions

Policy makers need to carefully monitor the care of the diabetes patients with more severe and complex disease statuses after the changes of P4P financial incentive design.     

Community Discharge of Nursing Home Residents: The Role of Facility Characteristics

Objective

Using a socio‐ecological model, this study examines the influence of facility characteristics on the transition of nursing home residents to the community after a short stay (within 90 days of admission) or long stay (365 days of admission) across states with different long‐term services and supports systems.

Data Source

Data were drawn from the Minimum Data Set, the federal Online Survey, Certification, and Reporting (OSCAR) database, the Area Health Resource File, and the LTCFocUs.org database for all free‐standing, certified nursing homes in California (n = 1,127) and Florida (n = 657) from July 2007 to June 2008.

Study Design

Hierarchical generalized linear models were used to examine the impact of facility characteristics on the probability of transitioning to the community.

Principal Findings

Facility characteristics, including size, occupancy, ownership, average length of stay, proportion of Medicare and Medicaid residents, and the proportion of residents admitted from acute care facilities are associated with discharge but differed by state and whether the discharge occurred after a short or long stay.

Conclusion

Short‐ and long‐stay nursing home discharge to the community is affected by resident, facility, and sometimes market characteristics, with Medicaid consistently influencing discharge in both states.     

The Early Effects of Medicare's Mandatory Hospital Pay‐for‐Performance Program

Objective

To evaluate the impact of hospital value-based purchasing (HVBP) on clinical quality and patient experience during its initial implementation period (July 2011–March 2012).

Data Sources

Hospital-level clinical quality and patient experience data from Hospital Compare from up to 5 years before and three quarters after HVBP was initiated.

Study Design

Acute care hospitals were exposed to HVBP by mandate while critical access hospitals and hospitals located in Maryland were not exposed. We performed a difference-in-differences analysis, comparing performance on 12 incentivized clinical process and 8 incentivized patient experience measures between hospitals exposed to the program and a matched comparison group of nonexposed hospitals. We also evaluated whether hospitals that were ultimately exposed to HVBP may have anticipated the program by improving quality in advance of its introduction.

Principal Findings

Difference-in-differences estimates indicated that hospitals that were exposed to HVBP did not show greater improvement for either the clinical process or patient experience measures during the program''s first implementation period. Estimates from our preferred specification showed that HVBP was associated with a 0.51 percentage point reduction in composite quality for the clinical process measures (p > .10, 95 percent CI: −1.37, 0.34) and a 0.30 percentage point reduction in composite quality for the patient experience measures (p > .10, 95 percent CI: −0.79, 0.19). We found some evidence that hospitals improved performance on clinical process measures prior to the start of HVBP, but no evidence of this phenomenon for the patient experience measures.

Conclusions

The timing of the financial incentives in HVBP was not associated with improved quality of care. It is unclear whether improvement for the clinical process measures prior to the start of HVBP was driven by the expectation of the program or was the result of other factors.     

Higher Incentive Payments in Medicare Advantage's Pay‐for‐Performance Program Did Not Improve Quality But Did Increase Plan Offerings

Objective

To evaluate the effects of the size of financial bonuses on quality of care and the number of plan offerings in the Medicare Advantage Quality Bonus Payment Demonstration.

Data Sources

Publicly available data from CMS from 2009 to 2014 on Medicare Advantage plan quality ratings, the counties in the service area of each plan, and the benchmarks used to construct plan payments.

Study Design

The Medicare Advantage Quality Bonus Payment Demonstration began in 2012. Under the Demonstration, all Medicare Advantage plans were eligible to receive bonus payments based on plan‐level quality scores (star ratings). In some counties, plans were eligible to receive bonus payments that were twice as large as in other counties. We used this variation in incentives to evaluate the effects of bonus size on star ratings and the number of plan offerings in the Demonstration using a differences‐in‐differences identification strategy. We used matching to create a comparison group of counties that did not receive double bonuses but had similar levels of the preintervention outcomes.

Principal Findings

Results from the difference‐in‐differences analysis suggest that the receipt of double bonuses was not associated with an increase in star ratings. In the matched sample, the receipt of double bonuses was associated with a statistically insignificant increase of +0.034 (approximately 1 percent) in the average star rating (p > .10, 95 percent CI: −0.015, 0.083). In contrast, the receipt of double bonuses was associated with an increase in the number of plans offered. In the matched sample, the receipt of double bonuses was associated with an overall increase of +0.814 plans (approximately 5.8 percent) (p < .05, 95 percent CI: 0.078, 1.549). We estimate that the double bonuses increased payments by $3.43 billion over the first 3 years of the Demonstration.

Conclusions

At great expense to Medicare, double bonuses in the Medicare Advantage Quality Bonus Payment Demonstration were not associated with improved quality but were associated with more plan offerings.     

Administrative reform and pay‐for‐performance methods of primary health service delivery: A comparison of 3 health districts in Cambodia, 2006‐2012

Since 1999, performance‐based financing or pay‐for‐performance (P4P) methods have been piloted in the Cambodian public health sector, first as one part of external contracting approaches with international nongovernment organizations and from 2009 as a part of internal contracting arrangements between units within the Ministry of Health under a wider public sector administrative reform. This study analyses these reforms and compares outcomes in 3 health districts. The study analysed routine quantitative data for primary care service delivery by using the interrupted time series method. Qualitative data were collected from key informant interviews. Both the level and the trend line of key service delivery indicators during earlier contracting/P4P models were at least maintained and in most cases increased with the move to internal contracting. The results of the interrupted time series analysis were mixed, mainly due to contextual issues. Qualitative results indicated an increased sense of local ownership and financial sustainability. Despite the gains, the management of personnel and the implementation and the integrity of contract monitoring were found to be compromised in this case. To be fully effective, contracting and P4P approaches must be accompanied by changes in the structure and culture of government administration.     

Prevention of Subsequent Catheter‐Related Bloodstream Infection Using Catheter Locks in High‐Risk Patients Receiving Home Parenteral Nutrition

Introduction:Catheter‐related bloodstream infection (CRBSI) is a serious complication in patients receiving home parenteral nutrition (HPN). Antibiotic lock therapy (ALT) and ethanol lock therapy (ELT) can be used to prevent CRBSI episodes in high‐risk patients. Methods: Following institutional review board approval, all patients enrolled in the Mayo Clinic HPN program from January 1, 2006, to December 31, 2013, with catheter locking were eligible to be included. Patients without research authorization and <18 years old at the initiation of HPN were excluded. Total number of infections before and after ALT or ELT were estimated in all patients. Results: A total of 63 patients were enrolled during the study period. Of 59 eligible patients, 29 (49%) were female, and 30 (51%) were male. The median duration of HPN was 3.66 (interquartile range, 0.75–8.19) years. The mean age ± SD at initiation of HPN was 49.89 ± 14.07 years. A total of 51 patients were instilled with ALT, and 8 patients were instilled with ELT during their course of HPN. A total of 313 CRBSI episodes occurred in these patients, 264 before locking and 49 after locking (P < .001). Rate of infection per 1000 catheter days was 10.97 ± 25.92 before locking and 1.09 ± 2.53 after locking (P < .001). Discussion: The major findings of the present study reveal that ALT or ELT can reduce the overall rate of infections per 1000 catheter days. ALT or ELT can be used in appropriate clinical setting for patients receiving HPN.     

Determinants of Private Long‐Term Care Insurance Purchase in Response to the Partnership Program

Objective

To assess three possible determinants of individuals'' response in their private insurance purchases to the availability of the Partnership for Long‐Term Care (PLTC) insurance program: bequest motives, financial literacy, and program awareness.

Data Sources

The health and retirement study (HRS) merged with data on states'' implementation of the PLTC program.

Study Design

Individual‐level decision on private long‐term care insurance is regressed on whether the PLTC program is being implemented for a given state‐year, asset dummies, policy determinant variable, two‐way and three‐way interactions of these variables, and other controls, using fixed effects panel regression.

Data Extraction Methods

Analysis used a sample between 50 and 69 years of age from 2002 to 2010, resulting in 12,695 unique individuals with a total of 39,151 observations.

Principal Findings

We find mild evidence that intent to bequest influences individual purchase of insurance. We also find that program awareness is necessary for response, while financial literacy notably increases responsiveness.

Conclusions

Increasing response to the PLTC program among the middle class (the stated target group) requires increased efforts to create awareness of the program''s existence and increased education about the program''s benefits, and more generally, about long‐term care risks and needs.