The Effect of Health Care System Administrator Pay-for-Performance on Quality of Care

Abstract

The effectiveness of pay-for-performance (P4P) programs for health care administrators has received little attention. In 2001, Baylor Health Care System (BHCS) began linking supervisor compensation to performance on the Joint Commission core measures. The effect of the P4P program was assessed on the basis of seven core measures for eligible patients discharged from the five BHCS acute care facilities from July 2001 to June 2005 using core measure-specific random effects logistic models. The time trends in performance were compared for BHCS and other hospitals nationwide reporting data on core measures to the Joint Commission. Improved performance for 13,673 patients (17,114 admissions; 4,035 admissions before the intervention and 13,079 after) was associated with exposure to administrator P4P for all individual core measures. This effect persisted following adjustment for age and gender (all p values < .0001) but weakened following adjustment for calendar time. Aspirin at discharge and pneumococcal vaccination performance remained significant following adjustment for calendar time. BHCS hospitals exposed to P4P increased performance on all P4P core measures more rapidly than a random sample of hospitals reporting the same measures, with increases in three of the measures significantly faster. The evidence provided by the study would have been stronger if it had it been possible to randomize exposure to the quality portion of the P4P program. In addition, BHCS engaged in several quality improvement initiatives that could have affected performance on the core measures. Still, linking administrator compensation to performance on specific clinical quality indicators may help improve health care quality. Further research is needed to clarify the impact of administrator P4P.