Paying hospital specialists: Experiences and lessons from eight high-income countries

Framework for responsive financing of district hospitals of India

Introduction

The current financing of public-sector district hospitals in India relies on historical budget allocations rather than actual utilization or healthcare needs. We utilized empirical data on healthcare delivery costs to develop the financing framework for these hospitals using a blended payment approach.

Methods

The primary data on cost of delivering services in 27 district hospitals across nine states of India was analysed along with indicators influencing the demand and supply of health services. Payment for outpatient, inpatient, and indirect services was assessed using the risk adjusted global budget, case-based bundled payment, and per-bed-global budget, respectively. Risk adjustment weights were computed by regressing the cost of outpatient care with demand and supply side factors which are likely to influence the utilization or the prices. Budget impact analysis was conducted to assess the fiscal implications of this payment approach, accounting for current care standards and two scenarios: upgrading district hospitals to Indian Public Health Standards (IPHS) or medical colleges.

Results

The average annual budget for a district hospital in India is estimated at ₹326 million (US$3.35 million), ranging from ₹66 million to ₹2.57 billion (US$0.8-31.13 million). Inpatient care comprises the largest portion (78%) of the budget. Upgrading to IPHS-compliant secondary hospitals or medical colleges would increase average budgets by 131 and 91.5%, respectively.

Conclusion

Implementing a blended payment approach would align funding with healthcare needs, enhance provider performance, and support ongoing financing reforms aimed at strategic purchasing and universal health coverage.

It's a jungle out there: Understanding physician payment and its role in group dynamics

Although collaboration between healthcare professionals is essential for the delivery of effective, efficient, and high-quality care, it remains an ongoing and critical challenge across health systems. As a result, many countries are experimenting with innovative payment and employment models. The literature tends to focus on improving collaboration across organizational and sectoral boundaries, and largely ignores potential barriers to collaborative work between members of the same profession within a single organization. Despite intergroup dynamics and professional boundaries having been shown to restrict patient flow and collaboration between specialties, studies have so far tended to overlook the potential effects of differentiated organizational and payment models on physicians' behaviors and intergroup dynamics. In the present study, we seek to unpack the influence of physicians' payment and employment models on their collaborative behaviors and on intergroup dynamics between specialties, adding to the current scholarship on physician payment and employment by considering how physicians' view and act in response to different structural arrangements. The findings suggest that adopting hybrid models, in which physicians are employed or paid differently within the same organization or practice, creates a bifurcation of the profession whereby physicians across different models are perceived to behave differently and have conflicting professional values. These models are perceived to inhibit collaboration between physicians and complicate hospital governance, restricting the ability to move towards new models of care delivery. These findings can be used as a basis for future work that aims to unpack the reality of physician payment and offer important insights for policies surrounding physician employment.

International strategies, experiences, and payment models to incentivise day surgery

The importance of day surgery as a less costly alternative compared to conventional inpatient hospital stays is growing internationally. The rate of day surgery activities has increased across Europe. However, this trend has been heterogeneous across countries, and might still be below its potential. Since payment systems affect how providers offer care, they represent a policy instrument to further increase the rate of day surgeries. In this paper, we review international strategies to promote day surgery with a particular focus on payment models for 13 OECD countries (Australia, Austria, Canada, Denmark, England, Estonia, Finland, France, Germany, Netherlands, Norway, Sweden, Switzerland). We conduct a cross-country comparison based on an email survey of health policy experts and a comprehensive literature review of peer-reviewed papers and grey literature. Our research shows that all countries aim to strengthen day surgery activity to increase health system efficiency. Several countries used financial and non-financial policy measures to overcome misaligned incentive structures and promote day surgery activity. Financial incentives for day surgery can serve as a policy instrument to promote change. We recommend embedding these incentives in a comprehensive approach of restructuring health systems. In addition, we encourage countries to monitor and evaluate the effect of changes to payment systems on day surgeries to allow for more informed decision-making.

Investigating Clinical Excellence and Impact Awards (INCEA): a qualitative study into how current assessors and other key stakeholders define and score excellence

OBJECTIVES

The National Clinical Excellence Awards (NCEAs) in England and Wales were designed, as a form of performance-related pay, to reward high-performing senior doctors and dentists. To inform future scoring of applications and subsequent schemes, we sought to understand how current assessors and other stakeholders would define excellence, differentiate between levels of excellence and ensure unbiased definitions and scoring.

DESIGN

Semistructured qualitative interview study.

PARTICIPANTS

25 key informants were identified from Advisory Committee on Clinical Excellence Awards subcommittees, and relevant professional organisations in England and Wales. Informants were purposively sampled to achieve variety in gender and ethnicity.

FINDINGS

Participants reported that NCEAs had a role in incentivising doctors to strive for excellence. They were consistent in identifying 'clinical excellence' as involving making an exceptional difference to patients and the National Health Service, and in going over and above the expectations associated with the doctor's job plan. Informants who were assessors reported: encountering challenges with the current scoring scheme when seeking to ensure a fair assessment; recognising tendencies to score more or less leniently; and the potential for conscious or unconscious bias in assessments. Particular groups of doctors, including women, doctors in some specialties and settings, doctors from minority ethnic groups, and doctors who work less than full time, were described as being less likely to self-nominate, lacking support in making applications or lacking motivation to apply on account of a perceived likelihood of not being successful. Practical suggestions were made for improving support and training for applicants and assessors.

CONCLUSIONS

Participants in this qualitative study identified specific concerns in respect of the current approaches adopted in applying for and in assessing NCEAs, pointing to the importance of equity of opportunity to apply, the need for regular training for assessors, and to improved support for applicants and potential applicants.

Same Day Discharge Strategy by Default in a Tertiary Catheterization Laboratory. Value Based Healthcare-Change in Practice

AIMS

To assess the effects on outcomes and hospital revenues (societal cost) of a by default strategy of same day discharge (SDD) in patients undergoing a cardiac catheterization procedure in a Belgian Hospital.

METHODS AND RESULTS

Outcome and complete financial data were obtained in all consecutive patients with a cardiac catheterization performed in 2019 (n=5237) and in 2021 (n=5377). Patient-reported experience, patient satisfaction and Net promotor score were obtained prospectively for the SDD cohort in 2021. The proportion of patients receiving catheterization procedure in SDD increased from 28 to 44 % (p<0.001). This translates to the saving of 889 conventional hospitalizations in 2021. All-cause death and readmission rate remained unchanged (0,17% vs 0,15% (p=0,004); and 0,7% vs 1,8% (p>0,05)) in 2019 and 2021, respectively. Patients satisfaction top box score was 91% and the Net Promotor Score was 89,5. The by default SDD strategy was associated with reduction in in-hospital health care spending, on average 3206€ per procedure is saved. This means a 57% decrease in hospital revenues and translates into an important decrease in physician income.

CONCLUSION

Implementing a by default SDD cardiac catheterization strategy results in a reduction of societal cost, excellent patient satisfaction and unchanged clinical outcome. Yet, in the given context this approach negatively impacts hospital and physician revenues precluding the sustainability of such protocol.

Alignment in the Hospital-Physician Relationship: A Qualitative Multiple Case Study of Medical Specialist Enterprises in the Netherlands

BACKGROUND

Policy-makers and hospital boards throughout the world have implemented different measures to create and sustain effective hospital-physician relationships. The 'integrated funding' policy reform in the Netherlands was aimed at increasing hospital-physician alignment and led to the unforeseen formation of medical specialist enterprises (MSEs): a fiscal entity representing all self-employed physicians in a hospital. It is unknown how hospitals and MSEs perceive their alignment and how they govern the relationship. This study explores the hospital-MSE relationship, and how governance styles influence perceived alignment in this relationship.

METHODS

A multiple case study of five non-academic hospitals in the Netherlands was performed. Data was derived from two sources: (1) analysis of hospital-MSE contracts and (2) semi-structured interviews with hospital and MSE board members. Contracts were analysed using a predefined contract analysis template. Interview recordings were transcribed and subsequently coded using the sensitizing concepts approach.

RESULTS

Contracts, relational characteristics, governance styles and perceived alignment differed substantially between cases. Two out of five contracts were prevention contracts, one was a mixed type, and two were promotion contracts. However, in all cases the contract played no role in the relationship. The use of incentives varied widely between the hospitals; most incentives were financial penalties. The governance style varied between contractual for two hospitals, mixed for one hospital and predominantly relational for two hospitals. Development of a shared business strategy was identified as an important driver of relational governance, which was perceived to boost alignment.

CONCLUSION

Large variation was observed regarding relational characteristics, governance and perceived alignment. MSE formation was perceived to have contributed to hospital-physician alignment by uniting physicians, boosting physicians' managerial responsibilities, increasing financial alignment and developing shared business strategies. Relational governance was found to promote intensive collaboration between hospital and MSE, and thus may improve alignment in the hospital-physician relationship.

How Denmark, England, Estonia, France, Germany, and the USA Pay for Variable, Specialized and Low Volume Care: A Cross-country Comparison of In-patient Payment Systems

BACKGROUND

Diagnosis-related group (DRG)-based hospital payment can potentially be inadequately low (or high) for highly variable, highly specialized, and/or low volume care. DRG-based payment can be combined with other payment mechanisms to avoid unintended consequences of inadequate payment. The aim of this study was to analyze these other payment mechanisms for acute inpatient care across six countries (Germany, Denmark, England, Estonia, France, the United States [Medicare]).

METHODS

Information was collected about elements excluded from DRG-based payment, the rationale for exclusions, and payment mechanisms complementing DRG-based payment. A conceptual framework was developed to systematically describe, visualise and compare payment mechanisms across countries.

RESULTS

Results show that the complexity of exclusion mechanisms and associated additional payment components differ across countries. England and Germany use many different additional mechanisms, while there are only few exceptions from DRG-based payment in the Medicare program in the United States. Certain areas of care are almost always excluded (eg, certain areas of cancer care or specialized pediatrics). Denmark and England use exclusion mechanisms to steer service provision for highly complex patients to specialized providers.

CONCLUSION

Implications for researchers and policy-makers include: (1) certain areas of care might be better excluded from DRG-based payment; (2) exclusions may be used to incentivize the concentration of highly specialized care at specialized institutions (as in Denmark or England); (3) researchers may apply our analytical framework to better understand the specific design features of DRG-based payment systems.

Two sides to every coin: Assessing the effects of moving physicians to employment contracts

There is a growing trend of physicians becoming employees of hospital systems and employment is viewed as a mechanism to help achieve health system goals. Yet, the research is mixed on the effects of moving physicians to employment models. While the literature has traditionally placed such forms of employment relationships in opposition to professional autonomy, it has often overlooked the effects on other professional values and there is little empirical work that actually assesses how such a shift affects and is perceived by clinicians themselves. To address these gaps, we conducted a mixed method study at one hospital that recently moved all formerly self-employed physicians to employment contracts. We interviewed physicians to understand how the shift into employment was perceived to influence their work in three domains: the patient domain, the individual domain and the organizational domain. We then conducted a follow-up survey across both formerly employed and self-employed physicians to test our initial findings. We find both positive and negative effects in different domains, offering insights into the mixed results found in the current literature.

Balancing financial incentives during COVID-19: A comparison of provider payment adjustments across 20 countries

Provider payment mechanisms were adjusted in many countries in response to the COVID-19 pandemic in 2020. Our objective was to review adjustments for hospitals and healthcare professionals across 20 countries.

We developed an analytical framework distinguishing between payment adjustments compensating income loss and those covering extra costs related to COVID-19. Information was extracted from the Covid-19 Health System Response Monitor (HSRM) and classified according to the framework. We found that income loss was not a problem in countries where professionals were paid by salary or capitation and hospitals received global budgets. In countries where payment was based on activity, income loss was compensated through budgets and higher fees. New FFS payments were introduced to incentivize remote services. Payments for COVID-19 related costs included new fees for out- and inpatient services but also new PD and DRG tariffs for hospitals. Budgets covered the costs of adjusting wards, creating new (ICU) beds, and hiring staff.

We conclude that public payers assumed most of the COVID-19-related financial risk. In view of future pandemics policymakers should work to increase resilience of payment systems by: (1) having systems in place to rapidly adjust payment systems; (2) being aware of the economic incentives created by these adjustments such as cost-containment or increasing the number of patients or services, that can result in unintended consequences such as risk selection or overprovision of care; and (3) periodically evaluating the effects of payment adjustments on access and quality of care.

Tackling the COVID-19 pandemic: Initial responses in 2020 in selected social health insurance countries in Europe☆

Countries with social health insurance (SHI) systems display some common defining characteristics - pluralism of actors and strong medical associations - that, in dealing with crisis times, may allow for common learnings. This paper analyses health system responses during the COVID-19 pandemic in eight countries representative of SHI systems in Europe (Austria, Belgium, France, Germany, Luxembourg, the Netherlands, Slovenia and Switzerland). Data collection and analysis builds on the methodology and content in the COVID-19 Health System Response Monitor (HSRM) up to November 2020. We find that SHI funds were, in general, neither foreseen as major stakeholders in crisis management, nor were they represented in crisis management teams. Further, responsibilities in some countries shifted from SHI funds to federal governments. The overall organisation and governance of SHI systems shaped how countries responded to the challenges of the pandemic. For instance, coordinated ambulatory care often helped avoid overburdening hospitals. Decentralisation among local authorities may however represent challenges with the coordination of policies, i.e. coordination costs. At the same time, bottom-up self-organisation of ambulatory care providers is supported by decentralised structures. Providers also increasingly used teleconsultations, which may remain part of standard practice. It is recommended to involve SHI funds actively in crisis management and in preparing for future crisis to increase health system resilience.

Optimizing Physician Payment Models to Address Health System Priorities: Perspectives from Specialist Physicians

OBJECTIVE

Despite well-documented data on the mixed impact of physician payment models, there is limited evidence on how to enhance existing payment model designs. This study examines the approaches to optimizing payment models from the perspective of specialist physicians to better support patient and physician experience and other health system objectives.

METHOD

Semi-structured interviews were conducted with 32 specialist physicians across Alberta, Canada. Data from the interviews were analyzed using a framework approach.

RESULTS

Respondents emphasized the need to incentivize physicians with the right blend of financial and non-financial incentives, including physician wellness. Respondents also highlighted the need for physician involvement and accountability to optimize the value of physician payment models.

CONCLUSION

To optimize physician payment models, it may be useful to include a blend of financial and non-financial incentives with clear accountability measures as this may better align physician practice with health system priorities.

The 2020 reform of the employment status of Hungarian health workers: Will it eliminate informal payments and separate the public and private sectors from each other?

Hungary, like many countries, features a complex mix of the public and private sector in the financing and provision of health care services. At the same time, the health system also faces challenges related to shortages of health professionals, low public financing, and informal payments. With the added pressure from the COVID-19 pandemic, Hungarian policymakers acted rapidly to pass a sweeping regulation aimed at these issues. Over two days, the Hungarian parliament introduced and unanimously approved a new regulation, Act C of 2020 on the Employment Status of Health Workers, that replaces the existing public employment relationship between health professionals, public providers and their controlling authorities. The Act, passed on 6 October 2020, brings the employment of health workers under strict central control by introducing a new employment status similar to that of the armed forces. The Act also provides doctors with an unprecedented 120% salary increase and criminalizes informal payments. The reception has been overwhelmingly negative, with thousands of health professionals indicating that they would not sign the new contracts, and the policy also contains serious technical and feasibility concerns. Although the first statistics show that only about 3-5% of the active workforce did not sign the contract by 1 March 2021, the implementation of the reform still faces serious challenges.

For-Profit Hospitals Have Thrived Because of Generous Public Reimbursement Schemes, Not Greater Efficiency: A Multi-Country Case Study

For-profit hospitals' market share has increased in many nations over recent decades. Previous studies suggest that their growth is not attributable to superior performance on access, quality of care, or efficiency. We analyzed other factors that we hypothesized may contribute to the increasing role of for-profit hospitals. We studied the historical development of the for-profit hospital sector across 4 nations with contrasting trends in for-profit hospital market share: the United States, the United Kingdom, Germany, and the Netherlands. We focused on 3 factors that we believed might help explain why the role of for-profits grew in some nations but not in others: (1) the treatment of for-profits by public reimbursement plans, (2) physicians' financial interests, and (3) the effect of the political environment. We conclude that access to subsidies and reimbursement under favorable terms from public health care payors is an important factor in the rise of for-profit hospitals. Arrangements that aligned financial incentives of physicians with the interests of for-profit hospitals were important in stimulating for-profit growth in an earlier era, but they play little role at present. Remarkably, the environment for for-profit ownership seems to have been largely immune to political shifts.

Value-Based Provider Payment Initiatives Combining Global Payments With Explicit Quality Incentives: A Systematic Review

An essential element in the pursuit of value-based health care is provider payment reform. This article aims to identify and analyze payment initiatives comprising a specific manifestation of value-based payment reform that can be expected to contribute to value in a broad sense: (a) global base payments combined with (b) explicit quality incentives. We conducted a systematic review of the literature, consulting four scientific bibliographic databases, reference lists, the Internet, and experts. We included and compared 18 initiatives described in 111 articles/documents on key design features and impact on value. The initiatives are heterogeneous regarding the operationalization of the two payment components and associated design features. Main commonalities between initiatives are a strong emphasis on primary care, the use of "virtual" spending targets, and the application of risk adjustment and other risk-mitigating measures. Evaluated initiatives generally show promising results in terms of lower spending growth with equal or improved quality.

The Role of Stereotactic Radiosurgery in the Management of Brain Metastases From a Health-Economic Perspective: A Systematic Review

BACKGROUND

Stereotactic radiosurgery (SRS) is an effective option in the management of brain metastases, offering improved overall survival to whole-brain radiation therapy (WBRT). However, given the need for active surveillance and the possibility of repeated interventions for local/distant brain recurrences, the balance between clinical benefit and economic impact must be evaluated.

OBJECTIVE

To conduct a systematic review of health-economic analyses of SRS for brain metastases, compared with other existing intervention options, to determine the cost-effectiveness of this treatment across different clinical scenarios.

METHODS

The MEDLINE, EMBASE, Cochrane, CRD, and EconLit databases were searched for health-economic analyses, according to PRISMA (Preferred Reporting Items for Systematic Reviews and Meta-Analyses) guidelines, using terms relevant to brain metastases and radiation-based therapies. Simple cost analysis studies were excluded. Quality analysis was based on BMJ Consolidated Health Economics Reporting Standards (CHEERS) checklist.

RESULTS

Eleven eligible studies were identified. For lesions with limited mass effect, SRS was more cost-effective than surgical resection (6 studies). In patients with Karnofsky performance scale (KPS) >70 and good predicted survival, SRS was cost-effective compared to WBRT (7 studies); WBRT became cost-effective with poor performance status or low anticipated life span. Following SRS, routine magnetic resonance imaging surveillance saved $1326/patient compared to symptomatic imaging due to reduced surgical salvage and hospital stay (1 study).

CONCLUSION

Based on our findings, SRS is cost-effective in the management of brain metastases, particularly in high-functioning patients with longer expected survival. However, before an optimal care pathway can be proposed, emerging factors such as tumor molecular subtype, diagnosis-specific graded prognostic assessment, neuroprognostic score, tailored surveillance imaging, and patient utilities need to be studied in greater detail.

Limited Consequences of a Transition From Activity-Based Financing to Budgeting: Four Reasons Why According to Swedish Hospital Managers

Activity-based financing (ABF) and global budgeting are two common reimbursement models in hospital care that embody different incentives for cost containment and quality. The purpose of this study was to explore and describe perceptions from the provider perspective about how and why replacing variable ABF by global budgets affects daily operations and provided services. The study setting is a large Swedish county council that went from traditional budgeting to an ABF system and then back again in the period 2005-2012. Based on semistructured interviews with midlevel managers and analysis of administrative data, we conclude that the transition back from ABF to budgeting has had limited consequences and suggest 4 reasons why: (1) Midlevel managers dampen effects of changes in the external control; (2) the actual design of the different reimbursement models differed from the textbook design; (3) the purchasing body's use of other management controls did not change; (4) incentives bypassing the purchasing body's controls dampened the consequences. The study highlights the challenges associated with improvement strategies that rely exclusively on budget system changes within traditional tax-funded and politically managed health care systems.