How Might P 4 P And Public Quality Reporting Increase Disparities In Health Care Delivery ?

Pay-for-performance (P4P) and public quality-reporting programs can increase the quality of health care for the services being measured. However, unless carefully designed, these programs may have the unintended consequence of increasing racial and ethnic disparities. This paper describes ways in which P4P and public reporting programs may increase disparities and suggests ways in which programs might be designed that will make them likely to reduce, or at least not increase, disparities. [Health Affairs 26, no. 3 (2007): w405-w414 (published online 10 April 2007; 10.1377/hlthaff.26.3.w405)] The quality of health care in the United States is variable and not what it could be, given the country's technical resources. During the past decade, public and private purchasers of health care have begun implementing "pay-for-performance" (P4P) and public quality-reporting programs to induce physicians and hospitals to invest in improving quality. During the same period, it has become evident that the quality of care for racial and ethnic minority patients is worse than that for whites, and increasing attempts have been made to develop interventions to help physicians and hospitals reduce this disparity. These two movements--P4P and public reporting, on the one hand, and attempts to reduce disparities, on the other--have rarely intersected. This is unfortunate, because P4P and public reporting can have serious unintended consequences, and one of these consequences may be to increase health care disparities. During the next few years, as the number and size of programs expands--including, perhaps, the introduction of P4P for physicians by the Centers for Medicare and Medicaid Services (CMS)--there will be an important opportunity to design programs to minimize unintended consequences and to reduce disparities. The purpose of this paper is to explore two questions: First, what consequences are P4P and public reporting programs, as currently implemented, likely to have on disparities? Second, how can these programs be designed to reduce disparities instead of increasing them? Three caveats regarding the scope of this paper: First, the paper focuses on physicians, but analogous points can be made for hospitals and for health plans. Second, generally speaking, the unintended consequences of P4P and public reporting programs are likely to be similar. They should both be understood as external incentives--that is, as incentives in addition to physicians' professional desire to provide better care--to induce physicians to invest in improving quality. We use the term "external incentives" to refer to both P4P and public reporting programs, and we refer specifically to P4P or public reporting when the point we make is specific to that type of program only. Third, we use the term "minority patients" to refer to patients who are members of ethnic/racial minority groups. "Minority patients" vary tremendously in income, education, acculturation to the United States, and English language ability; the unintended consequences discussed are likely to be more severe for the more disadvantaged range of this spectrum. Although low-income, poorly educated white patients are not usually included in the term "minority patients," it is important to note that similar unintended consequences of external incentive programs may increase health care disparities between affluent and poor whites as well. How Might P4P And Public Quality Reporting Increase Disparities In Health Care Delivery? Empirical data on the effects of P4P and public quality reporting are still relatively scarce; the evidence to date may be summarized as suggesting that external incentives lead to positive but generally modest improvements in the areas of quality that are measured, at least in the short run. There are very few data available on the effects of external incentives on disparities in quality; they may be summarized by stating that such effects do in fact occur. These data (which are noted where relevant in the remainder of this section), surveys of physicians, experience in other industries, and theoretical considerations based on agency theory suggest at least five ways in which external incentives for quality may have the unintended consequence of increasing health care disparities. Reduction in income for physicians in poor minority communities. Both P4P and public reporting may adversely affect the income of physicians practicing in minority communities-particularly poor minority communities--thereby potentially reducing both the number of physicians who work in such communities and their ability to invest in processes to improve quality. Physicians in these areas are doubly disadvantaged in trying to achieve high quality scores: First, their "payer mix" is likely to include a high proportion of uninsured and Medicaid patients, so there will be less revenue for them to invest in information systems, staff, and the development of organized processes to improve quality. Second, patients in these areas might be less likely to adhere to treatment recommendations. They might, for example, be less likely to obtain preventive care such as mammograms and Pap smears and less likely to return for follow-up of abnormal results, because of problems with transportation and child care and because of difficulty comprehending the recommendation. If compared directly to physicians in wealthier areas, physicians in poor minority communities might be less likely to receive P4P incentive pay and more likely to be listed in public report cards as poor-quality physicians. If, as is sometimes proposed, health plans require patients to make higher copayments for seeing these "poor-quality" physicians, poor patients who live in these areas and lack the means to easily visit physicians in other areas could be harmed. Only one research study provides data directly relevant to this "poor may get poorer" problem: In the first evaluation of a P4P program recently introduced for primary care physicians by the British National Health Service (NHS), practices that served lower-income populations had lower quality scores. "Color-blind" quality improvement programs. P4P and public reporting could increase disparities if they induce medical groups to create organized processes to improve quality--such as programs to help patients with chronic illnesses learn "self-management" of their illness--and if minority patients are less likely to benefit from these programs. This would be the case, for example, if education--written or oral--is given in a language or cultural style or at a literacy level that minority patients understand poorly or feel is culturally insensitive. "Teaching to the test" might disproportionately affect minorities. P4P and public reporting could induce physicians to focus their time and attention (consciously or unconsciously) on types of care that are being measured, to the detriment of nonmeasured areas that could be equally or more important. This "teaching to the test," which has been found in other industries, could disproportionately affect minorities. For example, with a relatively uneducated diabetic patient who speaks poor English, the physician might focus on making sure the patient has a hemoglobin A1c test (because this is measured) but not on the time-consuming task of explaining to the patient how to control his or her diabetes and blood pressure (because control of these things is not measured). The same physician might not "teach to the test" to the same degree with a better educated, English-speaking patient, because he or she is more comfortable with that patient or believes that the patient is more capable of adhering to a therapeutic regimen, or because the patient is more assertive in demanding time and explanation from the physician. Avoiding patients perceived as likely to lower quality scores. P4P and public reporting might induce individual physicians and medical groups to avoid patients whom they perceive as being likely to lower their quality scores, particularly if quality measures are not adequately adjusted for the patients' overall health status and perhaps for racial or socioeconomic characteristics as well. There is ample evidence that physicians perceive minority patients as less likely to comply with their recommendations for treatment and preventive services and more likely to have bad outcomes. There is also evidence that physicians subject to external incentives will try to avoid minority patients because they perceive them as more likely to have poor outcomes from treatments, even when this is not the case. After New York State initiated its report card measuring death rates from coronary artery bypass graft (CABG) surgery for individual surgeons and hospitals, the gap between CABG rates for whites and blacks increased. The report card appears to have made surgeons more reluctant to operate on black patients. It is widely recognized that outcome measures of quality should be adjusted for patients' health status, and some attempt to do so is often made. However, racial or socioeconomic factors, or both, may also be associated with worse outcomes. For example, hospitalized children whose parents did not speak English well had a twofold increased risk for a serious medical event. The use of process measures, rather than outcome measures, is often proposed as a solution to the problem that patients' characteristics, in addition to physicians' actions, affect quality scores. It is often stated, without evidence being cited, that patients' characteristics do not affect physicians' scores on process measures and therefore that process measures, unlike outcome measures, need not be adjusted for patients' health status or socioeconomic status. To practicing physicians, this might seem implausible. For example, it should be easier for physicians who practice in affluent areas such as Marin County, California, than for those who practice in poor area