Thursday, September 11, 2008

Pay-for-performance versus doctor discipline

Pay-for-performance (P4P) is also known as value-based purchasing. It is the hot new thing in reducing excessive health care costs. Incentives will be paid for top performers.

Yup. Medicare reimbursement is changing. On October 1, 2008, the Centers for Medicare and Medicaid Services (CMS) will begin value-based purchasing (VBP), a three-year-plus phased implementation plan under which incentives will be paid to top performers. These incentives will be based on quality measures performance, not just reporting. Organizations that do not meet specified performance standards will lose reimbursement.

To ensure maximum CMS reimbursement, hospitals and health systems need to proactively assess current performance and identify quality improvement opportunities now. Enter a new cottage industry. Companies now exist to provide hospitals and health systems with the tools and services needed to succeed in the VBP environment. Hospitals and health systems will hire these companies to provide analytic tools, insights and experience needed to improve quality and succeed with VBP

The actual physicians, health systems and hospitals should be focused on improving quality of care. They should do this in house. By farming out the responsibility to a corporation sincerely striving to improve quality, the accountability for bad acts are likewise farmed out.

The health systems lost considerable control over their physicians when credentialing was farmed out to the Joint Commission and other credentialing organizations. When a physician deviates from the appropriate standard of medical care, it would be useful if the employer hospital or medical clinic could or would discipline the physician under a system of peer review. That does not happen.

Now the focus is on paying for performance. Instead of focusing on top performers, the emphasis should be on stopping the bad doctors from practicing medicine.

We should focus on first things first as it pertains to physician performance. Create a system to discipline bad doctors before paying for high performance.

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