Pharmacy Management Approach: How Do We Align All the Incentives?

BACKGROUND: While health care costs continue to rise and shift toward employers, a parallel improvement in health care quality has not been evident. As a means to repair this apparent disconnect, pay for performance (P4P) initiatives are being implemented across the country. OBJECTIVES: To explore the need for P4P in the current state of health caredelivery and review the design, components, and results of P4P programs. SUMMARY: In P4P, clinical evidence is used by managed care organizations(MCOs) to drive financial incentives and align physicians and MCO goals,thereby improving delivery of care. At the center of all P4P programs are specific metrics, employed to measure the quality of care by which incentives are provided. These metrics fall into 4 main categories: clinical, patient satisfaction, efficiency, and technology. After metrics are employed and a provider is determined to be deserving of an incentive according to the P4P program in place, several different options exist and vary by plan in terms of incentive type. Primarily, these types of incentives include bonuses,adjustable fee schedules, and withholds. SelectHealth, a nonprofit health insurance company serving members in Utah and Idaho, implemented a primary care incentive program in 2002 for several different conditions and for pharmacy utilization that has been successful to date. CONCLUSIONS: While P4P programs are becoming increasingly common in managed care, challenges still remain, and data on whether these initiatives improve outcomes and manage costs is still limited.