Physician Performance Measurement

A Key to Higher Quality and Lower Cost Growth or a Lost Oppportunity?

Although the United States spends more than $2 trillion annually on health care, patient outcomes lag other developed countries that spend far less per capita. Physicians wield significant influence—directly and indirectly—over the quality and cost of health care, and efforts to measure and improve physician performance have gained momentum. Much of the impetus has come from purchasers seeking to engage consumers to be more active participants in their health and health care decisions. In response, health plans have developed physician performance measurement programs to provide information to consumers. However, methodological limitations, including the use of claims data, small sample sizes, and nonstandardized measures and assessments, have fueled skepticism about plan programs.

While measuring performance is an important step, health plans often fail to take the next step—supporting and rewarding physician performance improvement to encourage and reinforce desired behaviors. Arguably, physician performance measurement has such profound implications for all Americans’ health and health care that it should be a public good, transcending competitive dynamics. Standardizing measures, combining payers’ data, providing effective support for improvement, and creating robust rewards for good results offer some ways to improve the current state of physician performance measurement.

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