The Early Experience of a Hospital-Based Pay-for-Performance Program, Karen M. Sautter, Barbara G. Bokhour, Bert White, Gary J. Young, James F. Burgess, Jr., Dan Berlowitz, and John R. C. Wheeler
This study evaluated the effect of a health-plan-sponsored, hospital-based financial incentive program to improve quality, focused on heart failure quality indicators. We conducted separate, hour-long, semistructured group interviews with senior managers and cardiologists at ten hospitals involved in the Participating Hospital Agreement (PHA) program implemented by Blue Cross Blue Shield of Michigan (BCBSM). Under PHA, hospitals are eligible for an annual incentive payment of up to 4 percent of BCBSM's diagnosis-related-group–based inpatient claims depending on their performance in patient safety, community outreach, and selected quality indicators.
Interviews focused on knowledge, perceptions, and impact of pay-for-performance (P4P) strategies. We compared BCBSM-provided data on heart failure quality indicators between 2002 and 2004 with our qualitative findings. Our analyses suggest that pursuit of incentive-based quality targets may be largely dependent on the context of a particular hospital. In settings where performance did not change, incentives did not appear to drive organizational or individual practice change. Underperforming hospitals with some of the infrastructure necessary for quality improvement had the greatest success when presented with incentives. We concluded that one formula for a successful P4P program is to direct incentive payment to an organized entity capable of supporting process improvement by applying resources and organizational expertise. In this model, the incentive program supports the organization, and the organization in turn may apply resources to facilitate improvement in clinician performance. Consideration of the requirements of organizations to facilitate improvement in relation to existing quality improvement infrastructure may lead to the future success of hospital-based P4P programs.
Links Among High-Performance Work Environment, Service Quality, and Customer Satisfaction: An Extension to the Healthcare Sector, Dennis J. Scotti, Joel Harmon, and Scott J. Behson
Healthcare managers must deliver high-quality patient services that generate highly satisfied and loyal customers. In this article, we examine how a high-involvement approach to the work environment of healthcare employees may lead to exceptional service quality, satisfied patients, and ultimately to loyal customers. Specifically, we investigate the chain of events through which high-performance work systems (HPWS) and customer orientation influence employee and customer perceptions of service quality and patient satisfaction in a national sample of 113 Veterans Health Administration (VHA) ambulatory care centers. We present a conceptual model for linking work environment to customer satisfaction and test this model using structural equations modeling (SEM). The results suggest that (1) HPWS is linked to employee perceptions of their ability to deliver high-quality customer service, both directly and through their perceptions of customer orientation; (2) employee perceptions of customer service are linked to customer perceptions of high-quality service; and (3).perceived service quality is linked with customer satisfaction.
Theoretical and practical implications of our findings, including suggestions of how healthcare managers can implement changes to their work environments, are discussed.