Journal article

THE COST-EFFECTIVENESS OF USING FINANCIAL INCENTIVES TO IMPROVE PROVIDER QUALITY: A FRAMEWORK AND APPLICATION

Rachel Meacock, Soren Rud Kristensen, Matt Sutton

HEALTH ECONOMICS | WILEY | Published : 2014

Abstract

Despite growing adoption of pay-for-performance (P4P) programmes in health care, there is remarkably little evidence on the cost-effectiveness of such schemes. We review the limited number of previous studies and critique the frameworks adopted and the narrow range of costs and outcomes considered, before proposing a new more comprehensive framework, which we apply to the first P4P scheme introduced for hospitals in England. We emphasise that evaluations of cost-effectiveness need to consider who the residual claimant is on any cost savings, the possibility of positive and negative spillovers, and whether performance improvement is a transitory or investment activity. Our application to the ..

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Grants

Awarded by National Institute for Health Research Health Services and Delivery Research (NIHR HSDR) programme


Funding Acknowledgements

This project was funded by the National Institute for Health Research Health Services and Delivery Research (NIHR HS&DR) programme (project number 08/1809/250). Visit the HS&DR website for more information. The views and opinions expressed are those of the authors and do not necessarily reflect those of the HS&DR programme, NIHR, NHS or the Department of Health. We are grateful to Lesley Kitchen and Jane Harper of the Advancing Quality Alliance (http://www.advancingqualityalliance.nhs.uk/) for providing the data on the costs of the Advancing Quality programme and to participants in the UK Health Economists' Study Group in Oxford in June 2012 and a seminar at the University of York for their comments.