Seminar: Outcomes-based payments and physician productivity
The Centre for Health Economics at Monash Business School invites you to the research webinar 'Outcomes-based payments and physician productivity: Evidence from diabetes care in Hawaii,' presented by Associate Professor Jonathan Kolstad from the University of California, Berkeley.
Designing physician payments to incentivize low cost, high quality care is a core component of most health systems. Motivated by models from contract theory most pay-for-quality programs focus on paying directly for high quality health care. These programs reflect the information structure of the market that has limited the ability to measure health — a true measure of quality — and instead focused on care that is believed to improve health — paying for inputs. Furthermore, these programs rely on payment incentives, assuming marginal effort for quality is driven by pecuniary motivation.
We explore two innovations that relax these constraints. First, new technologies and better data increasingly make it feasible to measure health outcomes directly. Second, where physicians are motivated by diverse incentives (e.g. intrinsic motivation to provide better care) incentive programs have additional design options to improve quality at a lower cost. We explore these questions empirically using novel proprietary data from HMSA, the largest insurer in the state of Hawaii, on care for diabetic patients.
HMSA implemented a number of program changes allowing us to recover average physician response to payment for inputs — measured by process based measures of screening — and the change to paying for outputs — measured by HbA1c levels, a measure of actual patient health. We show that the initial input incentives had minimal impact on screening, treatment decisions and, ultimately, patient health measured by A1c. The change to outcomes-based incentives, however, led to meaningful changes in health care treatments (insulin prescribing) as well as health outcomes (A1c levels). These average effects mask substantial heterogeneity along dimensions correlated with underlying physician motivation.
Presenter
Jonathan Kolstad is an Associate Professor at the Haas School of Business and in the Economics Department at UC Berkeley and a Research Associate at the National Bureau of Economic Research. He is an economist whose research interests lie at the intersection of health economics, industrial organization and public economics. He is particularly interested in finding new models and unique data that can account for the complexity of markets in health care, notably the role of information asymmetries and incentives. Kolstad was awarded the ASHEcon Medal in 2018, given biennially to the economist age 40 or under who has made the most significant contributions to the field of health economics, the Arrow Award for the best paper in health economics in 2014 and the NIHCM Foundation Research Award in 2016 and 2018. He is currently also serving as a co-editor of the American Economic Journal: Economic Policy.
CHE seminar series
At the Centre for Health Economics, we are working on running as many of our seminars as possible online while COVID-19 remains an obstacle to getting together. As we will be working with experts and colleagues in other parts of the world there will be some movement in the times and days that seminars run to take into account different time zones and availabilities. If you would like to be on our seminar email list, please be directly in contact by email to shannon.stanwell@monash.edu.
Hope to see you there!
Event Details
- Date:
- 9 September 2020 at 9:00 am – 10:00 am
- Venue:
- This seminar will take place via Zoom - please email shannon.stanwell@monash.edu to register
- Categories:
- Health Economics
Description
The Centre for Health Economics at Monash Business School invites you to the research webinar 'Outcomes-based payments and physician productivity: Evidence from diabetes care in Hawaii,' presented by Associate Professor Jonathan Kolstad from the University of California, Berkeley.
Designing physician payments to incentivize low cost, high quality care is a core component of most health systems. Motivated by models from contract theory most pay-for-quality programs focus on paying directly for high quality health care. These programs reflect the information structure of the market that has limited the ability to measure health — a true measure of quality — and instead focused on care that is believed to improve health — paying for inputs. Furthermore, these programs rely on payment incentives, assuming marginal effort for quality is driven by pecuniary motivation.
We explore two innovations that relax these constraints. First, new technologies and better data increasingly make it feasible to measure health outcomes directly. Second, where physicians are motivated by diverse incentives (e.g. intrinsic motivation to provide better care) incentive programs have additional design options to improve quality at a lower cost. We explore these questions empirically using novel proprietary data from HMSA, the largest insurer in the state of Hawaii, on care for diabetic patients.
HMSA implemented a number of program changes allowing us to recover average physician response to payment for inputs — measured by process based measures of screening — and the change to paying for outputs — measured by HbA1c levels, a measure of actual patient health. We show that the initial input incentives had minimal impact on screening, treatment decisions and, ultimately, patient health measured by A1c. The change to outcomes-based incentives, however, led to meaningful changes in health care treatments (insulin prescribing) as well as health outcomes (A1c levels). These average effects mask substantial heterogeneity along dimensions correlated with underlying physician motivation.
Presenter
Jonathan Kolstad is an Associate Professor at the Haas School of Business and in the Economics Department at UC Berkeley and a Research Associate at the National Bureau of Economic Research. He is an economist whose research interests lie at the intersection of health economics, industrial organization and public economics. He is particularly interested in finding new models and unique data that can account for the complexity of markets in health care, notably the role of information asymmetries and incentives. Kolstad was awarded the ASHEcon Medal in 2018, given biennially to the economist age 40 or under who has made the most significant contributions to the field of health economics, the Arrow Award for the best paper in health economics in 2014 and the NIHCM Foundation Research Award in 2016 and 2018. He is currently also serving as a co-editor of the American Economic Journal: Economic Policy.
CHE seminar series
At the Centre for Health Economics, we are working on running as many of our seminars as possible online while COVID-19 remains an obstacle to getting together. As we will be working with experts and colleagues in other parts of the world there will be some movement in the times and days that seminars run to take into account different time zones and availabilities. If you would like to be on our seminar email list, please be directly in contact by email to shannon.stanwell@monash.edu.
Hope to see you there!