Long-Term Effect of Hospital Pay for Performance on Mortality in England

Study Questions:

Did a policy of incentive-based, hospital pay for performance (P4P) in northwest England improve long-term outcomes for pneumonia, heart failure, and acute myocardial infarction?


A prior study evaluating the early 18-month impact of this incentive-based P4P suggested benefit with lower 30-day mortality for patients admitted with three conditions at participating hospitals. Subsequent outcomes long-term are uncertain. Over 1.8 million hospital admissions for eight conditions were analyzed, three of which were covered by the incentive-based P4P. A difference-in-differences analysis was performed comparing outcomes at 24 hospitals that participated with 137 hospitals in England that did not participate. Outcomes were compared in the short-term (i.e., first 18 months) and long-term (i.e., subsequent 24 months).


Overall, there were three key findings: 1) performance of incentive-based P4P hospitals continued to improve for the three conditions involved during both the first 18-months and the subsequent 24 months; 2) performance of hospitals not involved also improved over time and more rapidly during the subsequent 24 months so that the differences between incentive-based P4P hospitals and hospitals not involved were no longer different at the end of the entire study period; and 3) performance of incentive-based P4P hospitals for the five conditions not covered by the program was better during the long-term than at hospitals not involved, suggesting spill-over effects.


Beneficial outcomes associated with an incentive-based P4P were not maintained long-term. The patterns observed were complex, however, and suggest spill-over effects to other regions as well as other conditions.


This elegant analysis challenges another key policy-lever of health care reform: incentive-based P4P. P4P is well-known to American cardiologists and doctors, as it is built into the Affordable Care Act through the Medicare Value-Based Purchasing Program. One of the key studies to have shown benefit with this approach was the earlier report issued from this group examining the experience of incentive-based P4P in the UK and its associated benefits in regard to 30-day mortality (Sutton M, et al. N Engl J Med 2012). This updated analysis reminds us once again though of the complexity of real-world data in policy evaluation. The initial benefits seen have now largely disappeared, leaving readers unsure of its overall impact. The authors hypothesize several possible explanations, including a lack of influence of incentives (especially as they changed from rewards to penalties) or a ‘ceiling’ effect following initial reductions. Another potential reason is ‘spill-over’ effects to control hospitals and other conditions not covered. All of this remains speculative, but raises a number of important challenges for policy-makers to consider in designing these programs as we move forward.

Clinical Topics: Heart Failure and Cardiomyopathies, Acute Heart Failure

Keywords: Hospitals, Motivation, Myocardial Infarction, Administrative Personnel, Pneumonia, Value-Based Purchasing, Health Care Reform, Heart Failure, Medicare, Reimbursement, Incentive, Patient Protection and Affordable Care Act, England

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