Title: Providers' response on the Pay for Performance incentives
Funder: Department of Health and Social Care

Abstract: Background: Pay for performance schemes (P4P) are used to incentivise high quality, efficient care. An example of P4P scheme in the secondary care setting in England are the Best Practice Tariffs (BPTs), introduced for four areas in 2010 and covering 34 different conditions by 2014/15. They do not directly reward improvements in health, but instead focus on changing the process of care delivery by encouraging adherence to a specific care pathway. Aims: The aim of this research is to critically evaluate the impact of BPTs for hip fractures, hip and knee replacement and the 15 day case conditions and to make recommendations about how financial incentives might be refined and extended to improve the quality of patient care. I will answer the following research questions during my fellowship: RQ1: Were the BPTs successful in achieving adherence to treatment according to best clinical practice? RQ2: What specific provider characteristics explain their adherence to the BPT criteria? RQ3: Can we observe improvements in outcomes for patients who followed the BPT pathway? RQ4: Is patient care more expensive if the patient follows the BPT pathway? RQ5: What unintended consequences, whether positive or negative, are associated with the BPT? RQ6: Are BPTs cost-effective? Plan of Investigation: I will start by reviewing the theoretical literature on P4P schemes in order to establish a broad conceptual framework to underpin the empirical analyses. This review will identify literature about the design of P4P schemes and about intended and unintended behavioural consequences. I will use this literature to provide a theoretical framework of P4P focusing on BPT. It will also be used to inform formulation of recommendations to policy makers for refinement of the scheme. In the empirical part I will analyse hospital admissions and outpatient data from Hospital Episode Statistics (HES) for years between 2007/8 and 2014/15. I will use provider level Reference costs to explore the cost implications of the BPTs. Use of these data will allow me to track changes over time in quality and cost for each BPT, to explore changes in variation within and across providers over time, and to compare these changes to conditions that were not subject to BPT financial incentives.Throughout this work I will employ a number of analytical techniques, including regression analysis in a generalized linear modelling framework, and propensity score matching to adjust for case-mix differences (where appropriate) Benefit to patients: BPTs affect the care of more than a million patients every year by directly influencing the treatment pathway. The proposed research aims to improve the benefit that patients get from their care by informing policy makers about the impact of BPTs on quality and cost and on possible refinements that would improve the financial arrangements. By analysing factors that affect the uptake of the BPT I will be able to advise on potential changes to the BPT that would allow more patients to receive better care. Investigating unintended consequences will take into account also patients with other, non-incentivised conditions, to make sure that BPTs have not made them worse off. Cost-effectiveness analysis will allow me to assess whether the money spent on BPTs provided good value or would have been better spent elsewhere.

Lay abstract: Policy makers often use financial rewards to motivate hospitals to improve their performance and provide better care for their patients. An example of this in England is the Best Practice Tariff (BPT). The BPT was first introduced in 2010 and covers several health problems. Hospitals can receive extra money on top of the base national tariff payment if they provide care to patients according to an agreed care pathway. The care pathways are different for each health problem. With more conditions covered by the BPT every year, the number of patients who might be treated according to a BPT pathway is growing very fast. Despite that, we still do have enough evidence to conclude that the scheme really works as it should or that it provides good value for money. My research will contribute new evidence in this field and provide advice on how we can improve it. I will research whether patients, who are treated on the BPT pathway, have better health outcomes than patients who could be on the pathway, but are not. I will look at different outcomes such as mortality and infection rates. I will further explore the cost of their care and whether BPTs provide good value for money. This is important because NHS resources are limited and we need to spend them in a way that the care provided is not compromised. While BPTs main aim is to improve the quality of care patients receive, they can also reduce variation in quality among hospitals. I will look at which hospitals are successful in treating patients using the BPT pathway. This can help make adjustments to the BPT. These changes could motivate hospitals to improve their care provided to all NHS patients. Financial rewards such as BPT often carry unwanted consequences, such as hospitals changing the way they report a health problem in order to receive the extra money or giving less attention to patients with other health problems that are not attached to a financial reward. During my fellowship I will examine different unwanted consequences of BPTs and how we can overcome them. I will present my work at national and international conferences and share my results with the policy makers and hospitals. I will also make recommendation on what can be done to improve BPTs to ensure best possible quality of care.

Research activity codes: 8.1 ORGANISATION AND DELIVERY OF SERVICES
Health categories: GENERIC HEALTH RELEVANCE