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Effect of Physician Pay-for-Performance (P4P) Incentives in a Large Primary Care Group Practice

Slide Presentation from the AHRQ 2008 Annual Conference

On September 9, 2008, Harold Luft, made this presentation at the 2008 Annual Conference. Select to access the PowerPoint® presentation (1.1 MB).

Slide 1

Effect of Physician Pay-for-Performance (P4P) Incentives in a Large

Primary Care Group Practice
Presenter: Harold Luft, PhD^1,2
Collaborators:
Sukyung Chung, PhD^1,2
Latha Palaniappan, MD, MS¹
Haya Rubin, MD, PhD
Laurel Trujillo, MD³
Eric Wong, MS¹

¹Palo Alto Medical Foundation Research Institute.
²Institute for Health Policy Studies, University of California San Francisco (UCSF).
³Palo Alto Medical Foundation.

Supported by AHRQ Task Order HHSA290200600023.

Slide 2

Empirical Evidence of P4P

Recent studies of P4P show modest effects.
- Group level incentives:
  - Rosenthal et al. (2005): increase in cervical cancer screening, but no effect on mammography and HbA1c testing.
  - Roski et al. (2003): better documentation of tobacco use, but no change in provision of quitting advice.
- Physician-specific (vs. no) financial incentives):
  - Levin-Scherz et al. (2006): increased diabetes screening, but no effect on asthma controller prescription.
  - Beaulieu & Horrigan (2005): improvement in most of the process and outcome measures of diabetes care.
  - Gilmore et al. (2007): improvement in most process of care measures (e.g. cancer screening, diabetes care).
  - Financial incentives were generally accompanied by other quality improvement efforts such as performance reporting.

Slide 3

Empirical Evidence of P4P (continued)

Limitations of previous studies:
- Payer-driven initiatives:
  - Quality measures and incentive schemes were given to, rather than chosen by, physicians or physician groups.
  - Only part of the physicians' patients were eligible for incentives.
- Incentives paid annually or at the end of the study.
  - Effect of timing of receipt of payment, in addition to the provision of performance reporting, is unknown.
- Based on claims data:
  - Limited physician-level information; no opportunity to investigate specific physician characteristics associated with incentives.

Slide 4

Research Questions

Does a P4P program with physician-specific incentives implemented in a large primary care group practice improve quality of care provided?
Are there associations across measures (within physicians) in the effect of the incentive program?
What physician characteristics affect variations in performance across physicians?
Does the frequency of payment (quarterly vs. end-of-year) make a difference in performance?

Slide 5

Study Setting

Palo Alto Medical Foundation (PAMF):
- Non-profit organization.
- Contracts with 3 physician groups in Northern California.
Palo Alto Division (PAMF/PAD):
- 5 sites: Palo Alto, Los Altos, Fremont, Redwood City, Redwood Shores.
- Physician payment: based on relative value units of service.
- Electronic health records since 2000.
- Implemented physician-specific financial incentives in 2007.

Slide 6

The Incentive Program

Physician-specific incentives based on own performance.
Comprehensive:
- All the primary care physicians (N = 179) and all their patients regardless of insurance type.
- Family Medicine, Internal Medicine, Pediatrics.
Physician participation:
- In determining performance measures and incentive formula.
Frequency and amount of bonus payment:
- Physicians were randomly assigned to quarterly or year-end payment.
- Maximum bonus: $1250/qtr or $5000/yr (~2-3% of salary).
- Payment delivered about 6 weeks following the evaluation quarter.

Slide 7

The Incentive Program (continued)

Various quality measures:
- Both outcome and process measures.
- 10 were selected from a set of existing measures used for quality assessment for several years.
- 5 new pediatrics-specific measures were selected based on AAP guidelines; some were further modified during the year.
- These pediatric measures are excluded in our analyses.
Quarterly performance reporting:
- All the physicians were alerted by quarterly email with an electronic link to quality workbook (a process in place for several years).
- In 2007, the report was to be sent on the 24th day after the quarter.
Funds:
- Integrated Healthcare Association (IHA) P4P incentives were supplemented by the organizational fund.
- Allowed application to all patients, not just those in IHA plans.

Slide 8

Incentivized Quality Measures

The table presents the "Description" and "Category" for each "Measure."

Diabetes HbA1c control*:
- HbA1c <=7 (diabetes patients).
- Outcome.
Diabetes Blood pressure (BP) control:
- Blood pressure <=130/80 (diabetes patients).
- Outcome.
Diabetes low-density lipoprotein (LDL) control*:
- LDL <=100 (diabetes patients).
- Outcome.
Asthma Rx*†:
- Long-term controller prescribed (asthma patients).
- Process.
Ht & Wt measured
- Height and weight measured for BMI calculation.
- Process.
Chlamydia screening*†:
- Chlamydia testing done (eligible women).
- Process.
Colon cancer screening:
- Colon cancer screening complete (adults age 50+).
- Process.
Cervical cancer screening:
- Pap smear done (eligible women).
- Process.
Tobacco Hx entered†:
- History of tobacco use was asked and recorded.
- Process.

Percent score = [numerator (i.e. patients who met the guideline)/denominator (i.e. patients who were eligible for the recommended care)] X100
* Similar measures (with different targets and population) were included in the IHA P4P program.
†These measures apply to some pediatrics patients.

Slide 9

Other Quality Measures: Examples*

The table presents the "Description" and "Category" for each "Measure."

Diabetes HbA1c control*:
- HbA1c <=8 (diabetes patients).
- Outcome.
Diabetes BP control:
- Blood pressure <=140/90 (diabetes patients).
- Outcome.
Diabetes LDL control*:
- LDL <=130 (diabetes patients).
- Outcome.
Hypertension BP control:
- Blood pressure <=140/90 (hypertension patients).
- Outcome.
Diabetes HbA1c check:
- HbA1c was measured within the past 6 months.
- Process.
Diabetes BP check:
- BP was measured within the past 12 months.
- Process.
Diabetes LDL check:
- LDL was measured within the past 12 months.
- Process.
Hypertension BP check:
- BP was measured within the past 12 months.
- Process.
Alcohol Hx entered:
- History of alcohol use was asked and recorded.
- Process.

These were not incentivized, but were reported in the quality workbook.

Slide 10

Example: Quality Workbook for "Diabetes HbA1c Control"

The line graph shows the "6mGly7 Score-FAMP." The vertical axis, percent, goes from 0% to 100% and the horizontal axis, provider, goes from P1 to P67. The line graph starts at 89% at P1 and steadily declines, reaching 9% by P67. Three arrows point out: Stretch goal (point=3) at 75%, P4; Intermediate goal (point=2) at 50%, P46-P54; and Minimum goal (point=1) at 40%, P62.

Slide 11

Incentive Formula

Incentive payment =
composite score * maximum amount {=$1250/quarter}
Composite score =
(∑ achieved points) / (3 * #qualifying measures)
- {Measures with <6 eligible patients for a physician in a quarter were not counted as a qualifying measure}
Physicians with <4 qualifying measures in a quarter were not paid for the Quarter.

Slide 12

Number of Participating Physicians

The table shows the results for "N=167*" and "Frequency (%)" for "Category."

Incentive frequency:
- Quarterly paid: 77; 46.1
- Yearly paid: 90; 53.9
Location:
- Fremont: 44; 26.4
- Los Altos: 26; 15.6
- Palo Alto: 76; 45.5
- Redwood City: 9; 5.4
- Redwood Shores: 12; 7.2
Department:
- Family medicine: 68; 40.7
- General internal medicine: 56; 33.5
- Pediatrics: 43; 25.8

*Among the initial sample (n=179), 12 physicians did not participate in the program due to various reasons (e.g. lack of number of patients, medical/sabbatical leave, etc.)

Slide 13

Quality Scores, Number of Patients and Physicians at Quarter I, 2007

The table shows the results for "Number of physicians with 6+ eligible patients at quarter 1 (N=167)," "Average number of eligible patients/physician (denominator)," "Average number of patients meeting the guideline/MD (numerator)", and "Percent score (numerator/denominator x 100)" for various "Quality Measures."

Clinical outcomes:
- Diabetes HbA1c control: 122; 39; 24; 60%
- Diabetes BP control: 122; 49; 24; 51%
- Diabetes LDL control: 122; 43; 25; 57%
Clinical process:
- Cervical cancer screen: 123; 529; 418; 77%
- Chlamydia screen: 138; 41; 16; 36%
- Colon cancer screen : 122; 315; 153; 45%
- Asthma Rx: 136; 21; 19; 92%
- Ht & Wt measured: 152; 926; 747; 71%
- Tobacco Hx entered: 161; 328; 290; 77%

Slide 14

Analyses

Does the 2006-07 change differ from 2005-06?
- H: (p2007 - p2006) - (p2006 - p2005) = 0
- Outcome variables: Percent scores for incentivized and not-incentivized measures.
- Unit of analysis: physician, each measure, each year (2005-2007).
Does the trend in Palo Alto Division differ from the trend in other PAMF divisions?
- H: PAD [(p2007 - p2006) - (p2006 - p2005)] - Other [(p2007 - p2006) - (p2006 - p2005)] =0
- Outcome variables: Percent scores for quality measures similar to the incentivized ones, but that were applied only to HMO patients.
- Unit of analysis: medical group, each measure, each year (2005-2007).
Does the frequency of payment make a difference in quality?
- H: p(Quarterly-paid, 2007) - p(Annually-paid, 2007) =0
- Outcome variables: Percent scores for incentivized measures.
- Unit of analysis: physician, each measure, four quarters of 2007.

Slide 15

Quality Scores: Four Quarters, 2007

The bar graph presents the percentage scores for Q1, Q2, Q3, and Q4 for Diabetes HbA1c ctrl; Diabetes BP ctrl; Diabetes LDL ctrl; Asthmas Rx; Cervical cancer screening; Chlamydia screening; Colon cancer screening; and Ht Wt measured.

Slide 16

Percent Scores: 2005-2007 (incentivized measures)

The table presents the percent scores for 2005-2007 for the following measures:

Diabetes HbA1c Control (less than or equal to 7).
Diabetes BP Control (less than or equal to 130/80).
Diabetes LDL Control (less than or equal to 100).
Cervical Cancer Screening.
Chlamydia Screening.
Colon Cancer Screening.
Asthma RX.
Ht & Wt Measured.
Tobacco Hx Entered.

Note: All scores increased except for "Diabetes LDL Control" which rose and then fell a percentage point.

Slide 17

Percent Scores: 2005-2007 (reporting only measures)

The table presents the percent scores for 2005-2007 for the following measures:

Diabetes HbA1c control (less than or equal to 8).
Diabetes BP control (Less than or equal to 140/90).
Diabetes LDL control (less than or equal to 130).
Hypertension BP ctl (less than or equal to 140/90).
Hypertension BP check.
Alcohol Hx entered.

Note: All measures increased except for "Hypertension BP check," which remained unchanged and "Diabetes LDL control," which rose two percentage points and then fell a percentage point.

Slide 18

Effects of the Physician Incentive Program†

The table presents the results for "OLS" and "Quantile Regression" for the following measures:

Diabetes HbA1c control (less than or equal to 7).
Diabetes BP control (less than or equal to 130/80).
Diabetes LDL control (less than or equal to 100).
Cervical cancer screening.
Chlamydia screening.
Colon cancer screening.
Asthma Rx.
Height & weight measured.
Tobacco Hx entered.

Slide 19

Effects of Physician Characteristics

The table presents the results for "Percent score at 2007 Q1 (0-100) (n=1179);" "Percent score at 2007 Q1 (0-100) (n=1179);" and "Improved between 2006-2007 (0/1) (N=1142)" for the following "Dependent Variables":

Average score in 2006 (0-100).
Female.
Foreign graduate.
Years of practice.
Internal medicine.
Pediatrics.
R-squared.

Slide 20

Comparison to Other Groups' Scores (2005-2007)*

The slide shows two line graphs: one showing the percent scores for "Asthma Rxs" and the other, the percent scores for "Controlling Blood Sugar for Diabetes Patients."

The first line graph shows the vertical axis, percent score, going from 0.50 to 1.00 and the horizontal axis, measurement year, going from 2005 to 2007. "PA," began at .95% in 2005, rose slightly to .97% in 2006, and then finished at .96% in 2007. "CMG" began at .94% and rose slightly to finish at .96% in 2007. "SCZ" began and ended at .95% and rose slightly to .96% in 2006.
The second line graph shows the vertical axis, percent score, going from 0.50 to 1.00 and the horizontal axis, measurement year, going from 2005 to 2007. "PA" stayed relatively the same at .82% for 2006 and 2007; "CMG" began at .71% in 2005 and rose to .84% by 2007; and "SCZ" began at .78% in 2005 and declined slightly to .75% by 2007.

These are IHA P4P measure scores. Definitions of the measures were similar to those incentivized at PAD, but the eligible patients for the IHA measures are limited to HMO patients.

Slide 21

Comparison to Other Groups' Scores (2005-2007) (Continued)

The slide shows two line graphs: one showing the percent scores for "Cervical Cancer Screening" and the other, the percent scores for "Chlamydia Screening."

The first line graph shows the vertical axis, percent score, going from 0.50 to 1.00 and the horizontal axis, measurement year, going from 2005 to 2007. "PA," began at .77% in 2005, rose to .86% in 2006, and then finished at .87% in 2007. "CMG" began at .77% in 2005, rose to .84% in 2006, and then finished at .83% in 2007. "SCZ" began at .77% in 2005, rose to .84% in 2006, and then finished at .88% in 2007.
The second line graph shows the vertical axis, percent score, going from 0.00 to 1.00 and the horizontal axis, measurement year, going from 2005 to 2007. "PA" began at .40% in 2005, rose to .50% in 2006, and then finished at .49% in 2007. "CMG" began at .69% in 2005, declined to .55% in 2006, and then finished at .57% in 2007. "SCZ" began at .38% in 2005, rose to .50% in 2006, and finished at .57% in 2007.

These are IHA P4P measure scores. Definitions of the measures were similar to those incentivized at PAD, but the eligible patients for the IHA measures are limited to HMO patients.

Slide 22

Correlation in Scores Across Measures (within physicians)

The slide presents three graphs.

Y: Hx tobacco entered (P4P).
X: Hx alcohol entered (non-P4P).
- The first graph shows the vertical axis, Hx tobacco entered avgscore, going from 0 to 1 and the horizontal axis, Hx alcohol entered avgscore, going from 0 to 1. The largest concentration of dots is located between .8 and 1 for both the x and y axis.
Y: Diabetes BP control (P4P).
X: Diabetes HbA1c control (P4P).
- The second graph shows the vertical axis, BPAvg130_80 avgscore, going from 0 to 1 and the horizontal axis, 6mGly7 avgscore, going from 0 to 1. The largest concentration of dots is located between .5 and .8 on the x-axis and .4 and .7 on the y-axis.
Y: Colon cancer screening (P4P).
X: Diabetes HbA1c control (P4P).
- The third graph shows the vertical axis, ColonCA_FullScrn avgscore, going from 0 to 1 and the horizontal axis, 6mGly7 avgscore, going from 0 to 1. The largest concentration of dots is located between .5 and .8 on the x-axis and .2 and .6 on the y-axis.

Slide 23

Does the Frequency of Payment Matter?

The table shows the "Coefficients" and "(SE)" for "Independent Variables.

Quarterly-paid (ref. cat.: paid end-of-year): 0.50; (1.14).
Quarterly-paid* Quarter:
Quarterly-paid * Quarter 2: -0.73; (0.92).
Quarterly-paid * Quarter 3: 0.34; (0.92).
Quarterly-paid * Quarter 4: -0.09; (0.93).
Observations: 3,767.

* p<0.05; ** p<0.01
Estimation methods: random effect linear regression.
Other covariates included are indicators of each quarter, quality measure, practice site and department.

Slide 24

Bonus Amount by Study Arm

The table presents the results for "Quarterly Paid" and "Annually Paid" for Quarters 1-4.

Quarter 1, 2007: $670; $718:
- (quality report date): 6/20/07; 6/20/07
- (payment date)7/5/07; -
Quarter 2, 2007: $670; $697:
- (quality report date): 7/24/07; 7/24/07
- (payment date): 8/6/07; -
Quarter 3, 2007: $741; $758:
- (quality report date): 10/24/07; 10/24/07
- (payment date): 11/6/07; -
Quarter 4, 2007: $751; $760:
- (quality report date): 1/24/08; 1/24/08
- (payment date): 2/6/08; -
Total: $2705; $2760

Note: *No statistical difference between two study arms.
†For the first quarter, there was two months delay in the reporting and payment.

Slide 25

Summary of Findings

Physician incentives have a modest effect on the improvement of some measures.
- Improvement in quality scores over the past three years for the incentivized and other related measures.
- For three measures (BP control of diabetes patients, colon cancer screening, tobacco Hx documentation), the improvement accelerated with the incentive program.
- Similar trend is observed in a measure (BP control of hypertension patients) that was not incentivized, but was reported to the physicians.
- The trend is not distinctively different from trends of two groups which did not have the same incentive program, but also underwent various quality improvement efforts.
- Other organizational or regional quality improvement effort may have confounded the effect of P4P.

Slide 26

Summary of Findings

Within—and across—physician variations.
- For each measure, within physician scores are consistent over time.
- No strong correlation across measures within a physician.
- More improvement among physicians whose score was middle or lowest in the previous year than those with highest score (data not shown).
Frequency of incentive payment (quarterly vs. end-of-year) does not make a difference
- No difference in scores or changes in scores over time between the two groups based on frequency of payment.
- Similar improvement in both arms for most measures.
- The effect of quarterly (vs. end-of-year) incentive payment may have been mitigated by the quarterly report sent to both arms.

Slide 27

Conclusions

Physician-specific incentives appear associated with modest acceleration in improvement in some targeted measures.
The frequency of payment by itself does not make a difference in performance in response to the P4P program.
In the context of other organizational-level quality improvement efforts, relatively small financial incentives to individual physicians have limited incremental effects on well-established measures.
Other incentives (e.g. increasing coverage of staff hours for quality improvement) should be explored.

Slide 28

Blank slide

Current as of January 2009

Internet Citation:

Effect of Physician Pay-for-Performance (P4P) Incentives in a Large Primary Care Group Practice. Slide Presentation from the AHRQ 2008 Annual Conference (Text Version). January 2009. Agency for Healthcare Research and Quality, Rockville, MD. http://www.ahrq.gov/about/annualmtg08/090908slides/Luft.htm