Healthy Incentives: Bonus pay for doctors reshaping medicare

Posted on January 31, 2010 in Health Debates – News
Published: Friday, January 29, 2010.   Tom Blackwell

Jay Mercer’s efforts to get more of his patients to undergo cancer screening are starting to pay off: early detection resulted in one woman having her cervical cancer cured and gave another high hopes for recovering from a breast tumour.

The screening push is also paying off, literally, for the Ottawa family physician. His preventive campaign is partly driven by a little-known recent trend in the Canadian health-care system: incentive payments, or bonuses, paid to doctors to encourage better health care.

If he pushes a set percentage of patients through cancer screening, Dr. Mercer is rewarded with a sizeable annual bonus. Ontario doctors can also earn bonuses of up to $5,000 for visiting patients at home; specialists in Nova Scotia receive thousands of dollars extra a year to simply stay in a rural location; and GPs in British Columbia are paid $2,100 annually just to keep delivering babies.

There are also bonuses for convincing people to have flu shots, better treating high blood pressure and merely taking on patients who have no family doctor.

Such payments — which come on top of regular fees for performing specific services — have proven costly and controversial in the U.K., where they were pioneered. Doctors in some of the four provinces experimenting with the concept here, however, insist that bonuses are already reshaping Canadian medicine for the better.

“This stuff works,” said Dr. Mercer. “What these incentives do is translate into better outcomes. You’ve got the funding to do the extra work … to start chasing down the [patients] who don’t come in.”

British Columbia introduced its incentives in part to convince doctors to operate full-service family practices with rosters of patients attached to them, rather than gravitate to the production-line — but more lucrative — medicine of walk-in clinics.

In just a couple of years, the bonuses appear to have stemmed the exodus from family medicine, said Dr. Brian Brodie, president of the B.C. Medical Association.

“In 2006, before these incentives started to roll out, it was so bad. People were leaving the hospitals; they were leaving family practices. It was dead, dead,” he said. “That conversation is done. … There’s been a huge difference.”

Patients whose doctors received the incentive payments — designed partly to encourage better treatment of chronic diseases such as hypertension and diabetes — also cost the medicare system less money, according to a report released last year by a consultant working for the province and the medical association. The theory is that they were less likely to need pricey hospital care.

The Hollander Analytical Services report was not all positive, however. A survey found that patients whose doctors claimed incentive payments were no more satisfied overall than those whose doctors did not.

The idea — sometimes called pay for performance or quality-based incentive payment — began appearing in other jurisdictions in the mid-2000s, a response to the pressures of a sicker, aging population and evidence of inappropriate use of medical care.

Britain has embraced the idea most enthusiastically, yet questions remain about the system’s effectiveness, and whether it has led to unintended, harmful side effects. A bonus paid to doctors who reduce the number of patients they send to hospital, for instance, is keeping certain patients from the hospital care they truly need, say some.

“The feeling in the U.K. has been fairly negative about the program,” said Dominka Wranik, a health economist at Dalhousie University who studies the concept. “It has been a large expense and didn’t lead to a lot of change.”

Pay for performance has been tried throughout the United States, as well, with mixed results. A study released last year by the Rand Corp. found that an incentive scheme for doctors in California had failed to improve the quality of health care.

Still, Prof. Wranik said the idea at least has the potential to enhance the system, so long as it is carefully designed and implemented.

The concept has come late to Canada, perhaps because of its roots in private-sector management philosophy. “The greatest fear I perceive in the Canadian public is that somehow we are going to be like the American system: ‘If we have any pay-for-performance, incentives, bonuses, that sounds a little fishy,’ ” said Dr. Brodie.

Nevertheless, at least four provinces — Nova Scotia, Ontario, Manitoba and B.C. — have quietly set up incentive-payment systems in the past two to three years, mostly for family doctors.

Physicians say they can earn in the range of $4,000 to $8,000 extra per year by meeting the quality goals.

Jane Brooks, a family doctor in Middleton, N.S., said she has taken advantage of bonuses that encourage physicians to visit patients in nursing homes. Though she is not doing more of that work now, the incentives have at least changed her plans to cut it back and concentrate more on office visits.

“It’s too early to say whether it’s [prompting] a change or not,” said Dr. Brooks. “It’s rewarding people for what they have been doing, and we can only hope it will improve access to quality care.”

Dr. Mercer said the incentive fees in Ontario have helped fund his office’s electronic medical records project. The computer system, in turn, enables him to easily identify patients who, for instance, should be reminded to have a mammogram or flu shot, helping him provide the service to enough patients so that he can earn a bonus.

A pap smear for one woman who is not normally diligent about undergoing the test found evidence of cervical cancer and led to a complete “surgical cure,” he said. Referral of a similar patient to a breast-cancer screening program led to another early diagnosis and good prospects for recovery.

Danielle Martin, spokeswoman for Canadian Doctors For Medicare, warned that governments have to be careful to avoid unintended consequences, like physicians eschewing the homeless and other patients who are difficult to get involved in services that earn bonuses, she said. Still, Dr. Martin believes that performance pay can produce better medical care, to a point.

“It makes much more sense to provide incentives for good health outcomes, rather than just pumping people through,” she said. “[But] it’s not going to be a magical transformation.”

National Post

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