Browse Definitions :
Definition

pay for performance (P4P)

Contributor(s): Matthew Haughn

Pay for performance (P4P), in healthcare, is a payment model where hospitals, physicians and other healthcare workers are given financial incentives for meeting performance objectives. P4P is also known as value-based purchasing.

P4P programs are supported by insurance providers, Medicaid or Medicare. P4P creates a system that rewards healthcare for efficiency and penalizes for increased costs, poor patient outcomes and medical errors. Since 2005, over 75% of United States healthcare has tied at least part of employee pay to performance. Over 100 private and federal P4P pilot programs exist.

P4P attempts to address two problems in United States healthcare: falling quality of care metrics and skyrocketing healthcare costs.

Clinical outcomes can be difficult to measure comparatively with different approaches to healthcare. To overcome this difficulty, P4P focuses on consistency, process quality and efficiency as performance indicators. For example, the Centers for Medicare and Medicaid Services (CMS), which covers healthcare for millions of Americans through Medicare, Medicaid, and the Health Insurance Marketplace, has four metrics collected from claims or administrative data that is used to evaluate provider performance:

  • Patient and caregiver experience, such as timely care and communication from staff;
  • Care coordination and patient safety, such as patient readmission rates and use of electronic health records (EHR);
  • Preventive health, such as cancer screenings and vaccinations;
  • And treatments for at-risk population, such as controlling high blood pressure for patients with hypertension.

Some problems exist in in P4P. Doctors express support for the effort to improve, but many also voice concerns that the health indicators chosen to measure performance are not tied to patient outcomes. Another issue is the fact that insurance companies do not pay for new practices as a method of reducing errors. From the client perspective, there is concern that high-risk patients could be avoided when pay is linked to clinical outcome improvements. According to critics, P4P also fails to address overinflated medication prices and, in the end, can put the burden on frontline workers when negative performance is punished. Critics say that, in general, improvements in outcomes and efficiency have failed to materialize except briefly with most P4P systems.

This was last updated in June 2017

Continue Reading About pay for performance (P4P)

Join the conversation

1 comment

Send me notifications when other members comment.

Please create a username to comment.

What is your opinion on the effectiveness of P4P and what may cause some of its issues?
Cancel

-ADS BY GOOGLE

File Extensions and File Formats

Powered by:

SearchCompliance

  • PCI DSS (Payment Card Industry Data Security Standard)

    The Payment Card Industry Data Security Standard (PCI DSS) is a widely accepted set of policies and procedures intended to ...

  • risk management

    Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings.

  • compliance framework

    A compliance framework is a structured set of guidelines that details an organization's processes for maintaining accordance with...

SearchSecurity

  • DNS over HTTPS (DoH)

    DNS over HTTPS (DoH) is a relatively new protocol that encrypts domain name system traffic by passing DNS queries through a ...

  • integrated risk management (IRM)

    Integrated risk management (IRM) is an approach to risk management that uses a set of practices and processes to improve an ...

  • MITRE ATT&CK framework

    The MITRE ATT&CK (pronounced 'miter attack') framework is a free, globally accessible service that provides comprehensive and ...

SearchHealthIT

  • telemedicine (telehealth)

    Telemedicine is the remote delivery of healthcare services, such as health assessments or consultations, over the ...

  • Project Nightingale

    Project Nightingale is a controversial partnership between Google and Ascension, the second largest health system in the United ...

  • medical practice management (MPM) software

    Medical practice management (MPM) software is a collection of computerized services used by healthcare professionals and ...

SearchDisasterRecovery

SearchStorage

  • M.2 SSD

    An M.2 SSD is a solid-state drive (SSD) that conforms to a computer industry specification and is used in internally mounted ...

  • kilobyte (KB or Kbyte)

    A kilobyte (KB or Kbyte) is a unit of measurement for computer memory or data storage used by mathematics and computer science ...

  • virtual memory

    Virtual memory is a memory management capability of an operating system (OS) that uses hardware and software to allow a computer ...

Close