Report: Pay-for-performance policies biased

Under the Affordable Care Act, Medicare and private insurers pay healthcare providers based on their performance, as measured by the quality of care they provide. However, these measures may be skewed because they fail to recognize the difficulties in treating patients who have lower levels of income or education, finds a new report commissioned by the Obama administration, reports The New York Times.

Payment policies intended to reward high-quality care actually penalize doctors and hospitals, according to the 26-member panel created by the National Quality Forum, a nonprofit that endorses healthcare standards. Low-income people may have trouble affording their medications or even getting to and from doctor's offices. If they don't have a high-level of education, it may be difficult for patients to understand medication instructions.

"Factors far outside the control of a doctor or hospital--patients' income, housing, education, even race--can significantly affect patient health, health care and providers' performance scores," NQF President Christine K. Cassel, M.D., told the Times.

Many ACA provisions look to boost care by linking Medicare payments to the performance of doctors, hospitals and health plans. In pay-for-performance programs, doctors and hospitals that treat poor people are more likely to face financial penalties, which inhibit resources providers need to administer care, the article notes.

Healthcare experts say the payment system must evolve and adapt to the changing market so it can provide reimbursements that best support population health improvement efforts, and that volume-based payments are holding the system back, FierceHealthcare previously reported.

Despite questions surrounding payment reforms, more and more payers want to adopt next generation business models, including accountable care organizations, value-based benefits and pay for performance, to maintain their position in the market or gain a competitive advantage. Sixty-five percent of 170 C-level payer executives said they will launch pay-for-performance programs over the next three years, according to a HealthEdge survey released last fall, FierceHealthPayer previously reported.

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