Can You Get What You Pay For? Pay-For-Performance and the Quality of Healthcare Providers
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NBER Working Paper No. 14886*
Issued in April 2009
NBER Program(s): HC
HE
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Despite the popularity of pay-for-performance (P4P) among health policymakers and private insurers as a tool for improving quality of care, there is little empirical basis for its effectiveness. We use data from published performance reports of physician medical groups contracting with a large network HMO to compare clinical quality before and after the implementation of P4P, relative to a control group. We consider the effect of P4P on both rewarded and unrewarded dimensions of quality. In the end, we fail to find evidence that a large P4P initiative either resulted in major improvement in quality or notable disruption in care.
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