Improving Health Care Quality: Is Medicare a Good Candidate for Pay-for-Performance?

November 2, 2006

The insurers and government agencies that purchase 80 percent of medical care in America have traditionally ignored quality. As a result, quality is lower than it could be. For over a decade, the private sector has experimented with financial incentives that reward doctors and hospitals for providing recommended care. Some, most recently the Institute of Medicine, argue that the federal Medicare program should do the same. Would Medicare give “pay-for-performance” a much-needed boost? Or would Medicare ruin the promise of P4P?

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