Strategies and Tools to Manage Variation in Regional Governance Systems

Abstract

The recent economic crisis has led to concerns about healthcare on two fronts: financial austerity may lead to increasing health disparities related to socioeconomic status, and the economic crisis has obliged decision-makers to contain costs. For both reasons, the issue of practice variation deserves attention. In most countries, the global financial crisis has contributed to reduced resources and cost containment for healthcare. This situation has forced policy-makers and managers to implement various efficiency controls, in the hopes of providing the same level of quality of health service at lower cost. At the same time, decision-makers are faced with the risk that financial austerity may lead to decreased health and increased health disparities among residents based on their socioeconomic status or place of residence. For both these reasons, central and local governments have needed to adopt managerial tools capable of supporting decision-making processes, including the management of medical practice variations. Different management tools have been developed to respond to the four categories of variations, that is, variations in evidence-based care, setting-sensitive care, preference-sensitive care, and supplysensitive care. Evidence-based medicine (EBM) standards, such as those adopted by the Tuscany performance evaluation system, may be appropriate tools for managing performance and reducing unwarranted variation in both evidence-based and setting-sensitive care. In these cases, financial incentives may help to reinforce the performance evaluation system. However, other kinds of mechanisms are required to manage variation in preference-sensitive and supply-sensitive care. In these situations, intrinsic incentives such as reports or direct feedback as opposed to financial incentives may serve to align the goals of providers with those of health authorities.