Of Interest

How healthcare providers make, spend, borrow and invest money.

Influence a doctor: Hire him

12:01 am, Nov. 7

Today, I bring a dispatch from the world of economic theory on how to influence doctors. Hire them, hospitals.

Economics professors James Rebitzer and Mark Votruba, in a paper published by the National Bureau of Economic Research (subscription required), reach this conclusion after listing formidable obstacles to coordinated care, among them the growth of independent medical specialists with the expertise and financial incentives to tailor treatment patterns to their advantage.

Rebitzer, at Boston University, and Votruba, with Case Western Reserve University, looked at how accountable care organizations may function among the competing incentives and social norms that motivate physician behavior.

They did so for what seems a dispiriting reason. The problem with U.S. healthcare is widely known: poor quality, waste and rising costs, they write. “What is less commonly acknowledged,” they continue, “is that many of the prominent strategies for reforming the delivery system are based on strong, largely untested beliefs about how organizations can best coordinate and motivate the physicians involved in patient care.”

Incentives for physician performance naturally depend on the ability to measure performance, the authors explain. Measurement, however, can be inaccurate for small physician groups (where random variation can skew results) while incentives can be weak among large groups (where any one doctors' poor performance may be masked by stronger performers).

The authors acknowledge a) most doctors remain independent, and in small medical groups and b) physicians appear to value autonomy. And they noted that some networks with independent doctors under an incentive plan have added independent physicians to the governing board to “build legitimacy” of the endeavor.

However, employers can exert influence by carefully selecting workers, with an emphasis on training and workplace culture, and by thoughtfully defining job descriptions, they say.

There is also a risk should accountable care emerge but fail, the authors write. “Encouraging the formation of ACOs with … no hope of successfully altering care patterns creates entities whose only rationale would be to bargain harder with insurers—an outcome that would enrich provides at the expense of the rest of society.”

You can follow Melanie Evans on Twitter: @MHmevans.


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