The unintended consequences of pay-for-performance

Effects of Changes in Diabetes Pay-for-Performance Incentive Designs on Patient Risk Selection

OBJECTIVE

Taiwan's National Health Insurance (NHI) Program implemented a Diabetes Pay-for-Performance Program (P4P) based on process-of-care measures in 2001. In late 2006, that P4P program was reformed to also include achievement of intermediate health outcomes. This study examined how the change in design affected patient risk selection.

DESIGNS/STUDY POPULATIONS

Study populations were identified from a 2002 to 2003 period (Phase 1) and a 2007 to 2008 period (Phase 2), spanning pre- and postimplementation of reforms in the P4P incentive design. Phase 1 had 74,529 newly enrolled P4P patients and 215,572 non-P4P patients, and Phase 2 had 76,901 newly enrolled P4P patients and 299,573 non-P4P patients. Logistic regression models were used to estimate the effect of changes in design on P4P patient selection.

PRINCIPAL FINDINGS

Patients with greater disease severity and comorbidity were more likely to be excluded from the P4P program in both phases. Furthermore, the additional financial incentive for patients' intermediate outcomes moderately worsened patient risk selection.

CONCLUSIONS

Policy makers need to carefully monitor the care of the diabetes patients with more severe and complex disease statuses after the changes of P4P financial incentive design.