Restructuring payment policies through performance incentive programs to explicitly promote improvements in the quality and value of health care has become a popular strategy for public and private health care payers. But our measures of quality are less than comprehensive, and current performance incentive strategies to improve quality may exacerbate disparities in health care. Despite the proliferation of pay-for-performance (P4P) and other performance incentive programs, data on whether they work to improve quality are scant and, where data exist, the results have been mixed. Over 40 P4P programs are known to focus on inpatient care alone, yet only eight peer-reviewed articles have assessed the effects of these programs on clinical quality, patient experience, safety, or resource use (Mehrotra et al. 2009). These studies have found some improvements in quality, but they also noted methodological problems in the assessments, which did not preclude the possibility that the improvements were due to temporal trends alone. Some of the largest assessments have found no significant improvements in quality (Lindenauer et al. 2007). Most remarkable, however, is that not a single one of these studies has reported data on the impact of these emerging P4P programs on equity (closing racial, ethnic, linguistic, and other socioeconomic gaps in health status), which is one of the six key dimensions of quality identified by the Institute of Medicine (Institute of Medicine Committee on Quality of Health Care in America 2001). This lack of investigation is especially striking because the potential for P4P programs to create unintended adverse consequences on equity is a well-recognized concern. Indeed, the lack of evidence regarding likely hazards of performance incentive programs for vulnerable populations and providers that care for them, such as safety net hospitals, has been a focus of particular concern and discussion for some time (Chien et al. 2007). Commentators have outlined several potential mechanisms through which P4P could worsen health disparities—including the creation of incentives for providers to avoid patients perceived to be more likely to have low-quality scores (cherry picking), the promotion of one-size-fits-all quality improvement initiatives that may be less effective for racial or ethnic minority groups or for patients with limited health literacy, and the widening of the resource gap for providers who care for these populations. Yet empirical research in this area is lagging. The lack of research is driven, in part, by the lack of data. Chien et al.'s (2007) search of the published literature from 1996 to 2006 led to 41,974 articles related to performance incentive programs, but only 536 of these articles contained any information about patient race and ethnicity. After excluding studies that were not empirical, not in English, and that were conducted outside the United States, they found a single research article on the impact of a public reporting, not P4P program, on disparities (Werner, Asch, and Polsky 2005). A more recent evaluation of the impact of a large P4P initiative on ethnic disparities in coronary heart disease management in the United Kingdom found improvements in quality measures across ethnic groups, but it was associated with reductions in disparities for only 2 of the 10 quality indicators (Millett et al. 2009). In light of continuing problems of rising costs, mediocre quality, and, therefore, relatively poor value for the money spent on health care in the United States, most commentators believe efforts to link payments more closely to providers' results on health care quality measures will be a key component of U. S. health care reform strategies. Health services researchers need to be informing these efforts and the design of these programs. To do so, however, we will need to address several critical knowledge gaps. Linking performance incentive programs to quality requires that we ask, How broadly or narrowly do we envision and define the dimensions of quality? Can we develop measures of quality that explicitly address the domain of equity? And, in developing standard measures in the various domains of quality, what is our understanding of the association between these measures and health outcomes? Key proposals to address these issues include the recent development of quality measures that are intended to directly target disparity reduction, along with the design of some P4P programs to reward quality improvement in addition to the achievement of high benchmark levels of quality (Casalino et al. 2007; Chien and Chin 2009). Here, we highlight pressing gaps in the literature and propose a set of priorities for health services researchers to advance the field of quality measurement and facilitate development of more comprehensive and effective performance incentive programs.