Pay-for-performance investments to become more common

Over the past year, we've had a chance to learn from a handful of larger provider organizations which have profited big from pay-for-performance programs. Given how complicated it can be to conform to P4P standards--with each insurer demanding different things--it's hardly surprising that smaller providers haven't been big players here. However, as  P4P compliance becomes mandatory in many contracts (notably, Medicare), medical groups and hospitals of all sizes are going to have to do what it takes to comply.

Given these forces, I expect to see providers spend big on institutionalizing P4P compliance. I'm talking about two things, largely: a) investment in IT systems that will help them make sure they're meeting key standards and b) hiring new staff with P4P-related duties in their job description. While hospitals and medical groups have been aware of quality and preventive care guidelines before, this will be the year in which they're forced to prove it--and such investments are the only way that they'll be able to do so.

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