Organisational matters Figure 1 Governing a patient safety market: how the major players might align. each year. Relative (intensity) targets are expressed as a rate relative to a variable that models the intensity of clinical activity (eg, number of patients), and provide a more flexible mechanism, normalised to different scale organisations or patient loads. Relative targets can be set using multiple variables. For example, casemix modelling of individual organisations could adjust for the relative complexity of patient conditions or services provided. There are risks and benefits to the different approaches that need to be considered when selecting baseline and target mechanisms. Experience with Kyoto suggests that fast-growing nations prefer relative targets, shrinking ones absolute targets.18 A related phenomenon is ‘‘grandfathering’’ or zero-price allocation of credits to existing organisations based upon their current performance. An organisation with poor safety perfor- mance could be relatively advantaged over an organisation with lower PAE rates, if past reductions at the safer organisation are not taken into account. Relative targets may mitigate against this but have their own limitations. As organisations grow, baseline PAE estimates also increase, generating new credits for expected additional PAEs. If the goal is to reduce the absolute number of PAEs, then intensity targets may be problematic. A number of studies show that, rather than issuing credits, auctioning them and recycling of revenue through tax reduction may lead to economic gains. Concentration targets can define the period over which absolute or relative targets are met, and contraction and Qual Saf Health Care 2009;18:99–103. doi:10.1136/qshc.2007.025833 convergence targets allow organisations with widely different starting-points time to converge, first on absolute targets, and then switch to relative targets. The length of commitment to targets before baselines are re-estimated is also an issue. Experience with climate change suggests that 5 years best fits the life-cycle of policymakers. Once trading is enabled, local auditing is needed to measure whether targets are met. The responsibility for developing and instituting such monitoring, reporting and verification systems will require thought. BENEFITS, RISKS AND POSSIBILITIES We anticipate many benefits from a patient safety market. Organisations are given a clear policy signal to reduce PAE rates, are told by how much but are free to use whatever mechanisms best suit their local needs. The reward for excellent organisa- tions that beat targets is that spare credits can be sold, yielding a financial reward that can be reinvested in improving care. However, are we allowing unsafe organisations to buy their way out of trouble? In reality, an organisation that buys credits is not rewarded for poor performance but pays a transparent financial penalty. It would be difficult to sustain an organisation that has to spend money to prop up poor practice. The incentive to change is direct and unavoidable, and accountability hard to evade when PAEs are measured in the bottom line. 101