Nurses Performance - Based Payment Incentives Increase Burden And Blame For

We interviewed hospital leaders and unit nurses in twenty-five hospitals between June and October 2008 to explore the effect of performance-based incentives. Interviewees expressed favorable impressions of the impact that incentive policies have on quality and safety. However, they raised concerns about the policies’ effects on the nurse workforce. Their concerns included the belief that performancebased incentives would increase both the burden and the blame for nurses without corresponding improvements in staffing levels, work environment, salaries, or turnover. To maximize the intended policy impact without jeopardizing the workforce that holds the key to their adoption, we recommend that policy makers invest in implementation support, redesign hospital incentives to reward teamwork, and involve nursing leaders in the design of future incentive policies. T he US health care system is considered to be among the most advanced in the world, but it is also fragmented, expensive, and unreliable. The Institute of Medicine (IOM)andMedicarePaymentAdvisory Commission (MedPAC), among other groups, have called for the adoption of performance-based financial incentives to achieve greater value. The purpose of this paper is to describe the perceived effects on hospitals of performancebased financial incentives, generally, and Medicare’s hospital-acquired conditions policy, in particular. The latter represents the federal government’s first major effort to link reimbursement to specific quality-of-care goals. Given the composition of the hospital workforce and nurses’ direct involvement in inpatient care, we emphasize the potential impact of these emerging policies on hospital leaders, nurses, and the quality of care provided. Performance-Based Incentives Performance-based incentives are tools intended to induce provider behavioral change to foster performance improvement and add value. These incentives can take various forms but typically pay bonuses to providers for demonstrated improvements in the quality of care. Todaymore than half of commercial health maintenance organizations (HMOs) and state Medicaid programs operate pay-for-performance programs. Medicare is also adjusting its reimbursement rates to rewardquality through various incentive programs. When the Centers for Medicare and Medicaid Services (CMS) launched its first hospital performance-based incentive program in 2003, participating hospitals reported positive results, including major improvements in care for heart failure, heart attacks, and pneumonia. These successes fueled policy makers’ support for pay-for-performance through the Affordable Care Act of 2010. In the interim, hospitals received their first “dose” of Medicare performance-based payment policy with the October 2008 implementation of the hospital-acquired conditions policy. Under this policy, CMS reduces payments to hospitals doi: 10.1377/hlthaff.2010.0573