Paying Doctors for Quality

I recently was listening to a doctor about the reimbursement movement that’s happening in healthcare towards paying for quality instead of procedures (pay for performance or other names). He said, “It’s the right direction, but we need more research on how to measure the quality of a doctor.” Then another doctor colleague said, “In fact, in many cases the outcome that you want is that NOTHING happens. It’s harder to measure and pay nothing.”

I must admit that I’m far from an expert on pay for performance and other possible changes to physician reimbursement, but I found these two comments really insightful. I think they do a good job of describing the challenge of paying doctors based on performance is going to have in the future.

One of the major challenges is with the time needed to measure the performance before you pay the doctor. Often you can’t judge the performance until months later and reimbursement months later isn’t a good motivational model.

One thing seems clear to me about pay for performance. We’ll never even be able to really consider going to a pay for performance model without broad EMR adoption. The data we’ll need to change the reimbursement model will require the data that an EMR software can produce.

I’d love to hear what other challenges people see with the pay for performance model of reimbursement.

About the author

John Lynn

John Lynn

John Lynn is the Founder of the, a network of leading Healthcare IT resources. The flagship blog, Healthcare IT Today, contains over 13,000 articles with over half of the articles written by John. These EMR and Healthcare IT related articles have been viewed over 20 million times.

John manages Healthcare IT Central, the leading career Health IT job board. He also organizes the first of its kind conference and community focused on healthcare marketing, Healthcare and IT Marketing Conference, and a healthcare IT conference,, focused on practical healthcare IT innovation. John is an advisor to multiple healthcare IT companies. John is highly involved in social media, and in addition to his blogs can be found on Twitter: @techguy.


  • One of my favorite blogs is “Science-Based Medicine.”

    To cite the current article:

    “…Of course, we’ve discussed the problems of publication bias before multiple times right here on SBM. Contrary to the pharma conspiracy-mongering of many CAM advocates, more commonly the reason for bias in the medical literature is what is described above: Simply confirming previously published results is not nearly as interesting as publishing something new and provocative. Scientists know it; journal editors know it. In fact, this is far more likely a problem than the fear of undermining the work of respected colleagues, although I have little doubt that that fear is sometimes operative. The reason is, again, because novel and controversial findings are more interesting and therefore more attractive to publish. A young investigator doesn’t make a name for himself by simply agreeing with respected colleagues. He makes a name for himself by carving out a niche and even more so if he shows that commonly accepted science has been wrong. Indeed, I would argue that this is the very reason that comparative effectiveness research (CER) is given such short shrift in the medical literature, so much so that the government has decided to encourage it in the latest health insurance reform bill. CER is nothing more than comparing already existing and validated therapies head-to-head against each other to see which is more effective. To most scientists, nothing could be more boring, no matter how important CER actually is. Until recently, doing CER was a good way to bury a medical academic career in the backwaters. Hopefully, that will change, but to my mind the very problems Ioannidis points out are part of the reason why CER has had such rough sledding in achieving respectability…”

    In other SBM articles, IIRC, you can find them taking on the semantic (and clinical) differentials separating “science-based medicine” and “evidence-based medicine,” (i.e., the latter being more frequently the grist for “practice guidelines”) and the sometimes problematic aspects of controlled clinical trials — vis a via e.g., daily outpatient practice, wherein cause and effect are frequently ever so loosely coupled. Doing everything “right” can still result in bad outcomes, and vice versa.

    I believe that EHRs will improve individual patient care at the encounter level, for all of the reasons that are by now a commonplace. Whether their extension HIEs will enable us to improve outcomes in the aggregate (via CER data mining) is a question whose answer will be many years in the making.

  • If you are interested in paying doctors for performance, you should have a look at some of the research around the Quality and Outcomes Framework used to supplement family doctor salaries in the UK. It has been a very interesting experiment. My overall feeling is that pay for performance works in getting doctors to do what you (i.e. the payer) want them to do but it is expensive and not clear that what the payer wants them to do is actually the best thing for the patient or health system generally.

    Have a look at

  • Bobby,
    “Doing everything “right” can still result in bad outcomes, and vice versa.”

    This part is what is scary about pay for performance.

    Thanks for pointing to the UK. I always forget to look internationally for learning. I got an invite to an EMR conference in Singapore. It would have been fun to attend. Just a little out of my budget.

    Your comments remind me of incentive plans for sales people. I think the quote goes something like, “Whatever you incetivize you’ll get so be careful what your incentives promote.” A similar idea with pay for performance I think.

  • Hey guys … stay in your lanes.

    Please stick to deploying value enhancing HETECH. We got enough academic amateurs at the Fed level screwing with med stuff they are clueless about.

    When we get the perfectly and fully deployed EHR/EMRs out there at all primary and secondary facilities … along with NHIN to connect to that giant Fed intelligent data warehouse thing … then it will be time to address the clinical stuff … if there is any of it still around.

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