HCFO Findings Brief: Pay-for-Performance Programs to Reduce Racial/Ethnic Disparities: Limitations of a One-Size-Fits-All Approach

May 2012

Pay-for-performance (P4P) programs are broadly defined as performance-based payment arrangements that are designed to promote improvement in health care quality while reducing costs. Often absent in the equation is the issue of disparities. Racial and ethnic disparities in health care persist, and some believe that P4P programs have the potential to exacerbate such inequities in the quality of care received by minority patients.In an HCFO-funded study, Joel S. Weissman, Ph.D., of the Center for Surgery and Public Health at Brigham and Women’s Hospital and colleagues examined the quality of hospital care, estimated the proportion of patients receiving recommended care, created new measures of patient care quality, and simulated the impact of several P4P scoring methods on hospital rankings. The study team determined that standard P4P programs based on ranking providers by overall quality of care may not be the most effective way to target disparities.