Practical Application Of Theory Of Performance Based Measures Essay

a. Describe the theory of Performance-based measures and its practical application.
With the implementation or utilization of a service, those receiving the service are under the expectation that the service provider should provide quality work in keeping with the client’s or customer’s satisfaction (Peer & Tenhula, 2010). The satisfaction of the customer must be the top priority in a business, as their primary goal is to serve the customer, who is their primary benefactor and the supplier of payment, and therefore funding. The theory of performance-based measures involves the reimbursement or payment of those providing a product or service based on how effective their service was (Peer & Tenhula, 2010). The pervading wisdom of this theory is that providing the administrator of a good or service with an incentive to perform as efficiently as possible towards the customer or client will facilitate that improvement in service (Park et al., 2009). These incentives could take the form of repeat business from customers or clients, and even direct measures of compensation toward the provider of the service by a governing body for quality works (Park et al., 2009). Practical Application Of Theory Of Performance Based Measures Essay

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Performance can be measured in a variety of ways – there is the level of work and dedication to which the service provider asserts themselves before the client, there is the client’s level of satisfaction with the provider’s work, and there are the resources available to the provider that allows for the highest quality work to be done (Kreiter & Bergus, 2009). All of these things must be looked at in comparable measure in order to facilitate the most effective means of tracking performance, and therefore rewarding compliant providers accordingly (Park et al., 2009). There are some factors that may be more important than others, but that is entirely dependent upon the governing body and the criteria that it sets in order to dispense performance-based rewards (Kreiter & Bergus, 2009).
Performance-based measures have their practical application in the dissemination of bonuses or other financial incentives to those service providers who fit a certain criteria. If those criteria are met, the bonuses are provided; if not, they are not rewarded (Peer & Tenhula, 2010). This system allows for the added means to incite action among service providers for improving their services, in case a personal ethos for providing quality service is not sufficient for their existing work (Peer & Tenhula, 2010). A governing body that provides measures by which a service provider must uphold would then compensate these providers either by maintenance of quality standards, or by level of improvement toward said standards (Kreiter & Bergus, 2009). In this way, a real and workable method of rating and rewarding service providers for their efforts can be reached. Practical Application Of Theory Of Performance Based Measures Essay

b. How can a theory guide or inform practice? What are the issues involved in translating theory into practice? Be sure to keep in mind the various conceptions of theory- Performance-based Measures.
A theory can guide or inform practice by providing the framework by which service providers must apply the practices they implement (Faith et al., 2010). Without the theory of performance-based measures, service providers would not be provided the criteria by which to change or improve their behavior; they would randomly alter aspects of their performance without having a barometer for improvement (Liang, 2007). According to the theory of performance-based measures, it is necessary to improve client care and satisfaction to a reasonable degree, to the level where their continued business and compensation can be relied upon – this guides practice by setting standards toward that end, ensuring that the most reliable measures are taken to provide the best level of service possible given the resources and personnel available. (Liang, 2007). Practical Application Of Theory Of Performance Based Measures Essay
The issues involved in translating theory into practice are many – there are often pitfalls that come from too direct an application of theory. There are often not realistic means by which to literally apply all the aspects of a theory; in the case of performance-based measures, it can be difficult when one is not sure how to apply the theory to individuals who would not be affected or inspired by the incentive (Faith et al., 2010). For example, those healthcare providers who only wish to work a certain amount would not be inspired by a financial incentive, as their primary barometer for work is time and energy spent, not income (Faith et al., 2010).
Transforming this theory into practice heavily involves the connection of the tenets of a theory – in this case, the aspects of their performance that could be improved – with practical, workable incentives and applications (Faith et al., 2010). The motivation must be present for a service provider, or else it simply will not work, and proper improvement of performance will not work (Kreiter & Bergus, 2009). This is where the incentives come in – this makes the desire to improve performance practical, as it shifts the motivation from simply adding extra work to being rewarded for said work (Faith et al., 2010). Performance improvement in a given field often requires resources that are not available at present to the service provider; in this case, it is necessary for them to either work with what they have, or take steps to acquire the resources needed to facilitate the performance-based criteria set up in order to receive incentives. Practical Application Of Theory Of Performance Based Measures Essay

PART 2

The application of performance-based measures in the field of healthcare is very similar to those in any other service-based field; rewards and criteria are expanded based on performance. Compared to other fields, the field of healthcare often has higher personal stakes for the individual, as one’s health and physical wellness are at stake, depending on the healthcare provider’s performance (Nicholson et al., 2008).

Pay-for-performance programs are the typical method of administering performance-based measures in the field of healthcare. These programs are created by insurance companies or payers who will provide financial incentives to the health care provider – they are often offshoots of Medicaid programs (Young et al., 2010). Hospitals and physicians are targeted, whether groups or individuals, in order to offer said incentives as a reward for achieving quality marks that have been set by the program. If these practices, facilities or individuals meet these criteria, they are rewarded with a set amount of income (Nicholson et al., 2008).

There are several barriers that can impede on the capability of P4P programs to improve the care administered to patients. One important setback is the often complicated medical requirements of patients; this can make it difficult to measure the degree of success with which the physician saw to their needs (Young et al, 2010). The limited resources that practices and facilities often have is also a significant problem encountered by many P4P programs; many could not provide the quality level of care dictated by these P4P programs regardless of dedication or willingness (Young et al., 2010). Those organizations who realize this will not have a proper incentive to make what limited improvements they have, because they know they cannot get rewarded for those incremental enhancements (Young et al., 2010). As a result, quite a few P4P programs are not met with the most significant improvements, whether in outcomes or level of care (Long et al., 2008). Often, the lack of resources can result in patient avoidance, which is frequently levied toward minorities, as they are most often thought to diminish the level of performance observed by a health care provider (Ryan, 2010). This is often seen as statistical discrimination – the group characteristics associated with African-Americans and other minorities lean toward the riskier edge of the health care spectrum (Ryan, 2010). The organization chooses to ignore the patient, seeing it in their best interests to avoid anyone who would get in the way of earning their financial incentives (Ryan, 2010). The theory of performance-based measures, therefore, is not without fault, despite its overall strong measures. Practical Application Of Theory Of Performance Based Measures Essay

The current theory of performance-based measures places a strict emphasis on levels of performance, whether it is degrees of performance (certain percentages by which an institution or organization has improved their level of care) or overall performance (number of exams or tests administered, number of patients successfully treated) (Long et al., 2010). A pitfall of the overall performance aspect of the P4P system is that there are many health care providers who already meet the standards set forth by the program, and as a result do not make efforts to improve their potential for care. This defeats the purpose of the system in the first place, and merely rewards these organizations for behavior and procedures they normally partake in (Long et al., 2008).

There are many ways in which performance-based measures are intended to be improved; there are measures to support quality improvement by raising or lowering the levels of criteria needed to receive the financial incentives (Van Herck et al., 2010). There are worries on both ends of the argument, however; if the bar lowers too far, those struggling organizations could meet their criteria (and thus work harder than if they knew they could not reach them) at the expense of more accomplished and resourced organizations ceasing to work for the incentives (Van Herck et al., 2010). On the other side of the coin, those more moneyed organizations could benefit from a raising of the inclusion criteria for a P4P program, but would cause those struggling organizations to not have a realistic incentive for attempting to introduce quality improvement in their structures (Van Herck et al., 2010). The structure of pay for performance programs is still in flux, given the untested nature of the initiative. However, the majority of P4P programs are said to lack incentives for offering specific processes or tests, something that could be included as criteria for inclusion in a greater number of P4P programs (Nicholson et al., 2008). Practical Application Of Theory Of Performance Based Measures Essay

PART 3

With this theory of performance-based measures in healthcare in mind, its application must be examined thoroughly in order to gauge the manner in which it is being implemented. Chien, Li, and Rosenthal (2010) attempted to look at how a ‘piece-rate’ pay-for-performance program would impact a program whose aim was to deliver immunizations to 2 year olds. The New York State-based program administered bonus payments of $200 to health care providers who completely immunized a 2-year-old child, finding other children who required immunization as well (Chien, Li & Rosenthal, 2010).

The theory of performance-based measures was applied fairly and appropriately; there was a direct financial incentive to immunizing a greater number of children, as it led people to get paid more for performing immunizations more efficiently. It also allowed a greater number of children to receive immunization, thereby lessening the number of potential future visits the children would require. As the program is a fairly straightforward monetary incentive for a measured level of improvement in health care, its application showcased an accurate understanding of performance-based healthcare and its scope, and no further. The application of the theory is very well thought out and simplified (Chien, Li & Rosenthal, 2010). Practical Application Of Theory Of Performance Based Measures Essay

Lee et al. (2010) performed a pay for performance healthcare management strategy in Taiwan, wherein diabetes care was the problem being targeted for improvement. According to their strategy, the performance criteria was number of hospital visits/exams and tests that were conducted each year by the NHI claims database, as well as how many diabetes-related physician visits and hospital admissions were allotted, and how much money NHI paid out. Their primary strategy was to see how much more diabetes care was administered after the P4P program was started than before. According to their results, it was clear that patients who enrolled in the program were able to receive a higher number of exams and tests, and were more readily involved in follow-up visits. These physician costs were a lot higher than normal, but the extra price paid off in the dramatic decrease in hospital admissions and less money spend in inpatient care (Lee et al., 2010).

The use of the pay-for-performance program was somewhat nebulous in this particular application; it is unclear exactly what was paid to whom and for what. The study states that the physicians who enrolled in the program were compensated by charging extra ‘enlarged physician fees’ and ‘case management fees.’ This implies that the clinicians themselves added on to their rates, which the NHI program then paid depending on their enrollment. This does not work toward the theory of performance-based measures that was set forward in Part 2; the health care program that is paying out the pay-for-performance bonuses is not allowed to set the bonus rate, which allows the clinician to be much too fluid in their assessment of their abilities. They also lack specific criteria (e.g. specific number of patients/exams administered) to qualify for the program, just simple enrollment. This does not provide sufficient incentive for improvement, and as a result leaves little work obligated to the clinician (Lee et al., 2010). Practical Application Of Theory Of Performance Based Measures Essay

In light of this particular pay-for-performance model, the theory of performance-based measures is not maintained, and merely rewards clinicians extra money for doing more, without setting the parameters of level of improvement or price involved. There is a very weak link in this reasoning between the current theory of performance-based measures and its application towards diabetes care in Taiwan (Lee et al., 2010).

Gemmell et al. (2008) studied a pay for performance contract introduced in England for general practice purposes, from the perspective of the workload involved in maintaining the criteria set by these programs. It was concluded that, despite (or perhaps because) of the requirement of quality improvement set forth by this pay for performance program, the workload placed on the nursing staff and the practicing doctors was much higher. This comes as a result of greater specialization being required by general practice doctors and teams, creating larger practices and role differentiation. In the pay for performance system introduced in England in 2004, practice income was dramatically increased when certain quality care indicators were met; points were awarded to the practices based on patients who met certain indicators, and each point offered a certain amount of money. It is said that care quality has dramatically improved since the introduction of this program, despite the bigger workload required by these practices (Gemmell et al., 2008). Practical Application Of Theory Of Performance Based Measures Essay

The pay for performance based program in England outlined in this study fits quite well with the criteria set for the current theory of performance-based measures. Put simply, the program offers set financial rewards for practices who meet certain landmarks in their criteria. It goes beyond the typical definition, however, when it discusses each patient having their own landmarks, or levels of satisfaction and quality – normally, these criteria typically involve set ratios or levels of care across the whole of the patient population. With this particular system, specific patient satisfaction is accounted for when compensating physicians and general practitioners (Gemmell et al., 2008).

McDonald and Roland (2009) performed a detailed exploration of pay-for-performance programs in both California and England, in order to see what the consequences were, particularly those which were unintended. Varying incentive programs were used; the California based program required inclusion of noncompliant patients – those who did not want treatment – while the English system did not. The California treatment plan involved a lesser level of interest and investment in primary care than the English system. Californian physicians were required to undergo more specific and greater initiatives and targets to reach, particularly depending on the payer and payment rules, of which there were many. The English system, on the other hand, was far more simplistic and wide-reaching, reforming the program in a broader sense (McDonald and Roland, 2009). Practical Application Of Theory Of Performance Based Measures Essay

The two systems examined in this study followed the theory of performance-based measures relatively closely, though the English system provided a greater amount of systematic reform. The Californian model had a lot of moving pieces to work with – many different payers to deal with, and varying levels of satisfaction among patients – to the level where it was difficult to standardize the system, unlike the clean, elegant, reform-based English version. Because the English version was based much more on improving patient care than it was the payment end of the spectrum, it was the system that adhered more closely to the theory of performance-based healthcare (McDonald and Roland, 2009).

De Brantes and D’Andrea (2009) discussed the Bridge to Excellence Program (BTE), which was a pay-for-performance incentive introduced in the United States, and the physician response to it. In essence, the BTE program works by offering recommended fixed bonuses for each eligible patient that receives care by that physician, payment being received after recognition and assessment of that practice. Two types of BTE programs focus on the systematic appraisal of the practice and the physician, respectively, rewarding each for meeting the measurement criteria set forth. Due to the set financial reward for meeting specific criteria, it more than meets the requirements to match the theory of performance-based measures in healthcare (De Brantes and D’Andrea, 2009). Practical Application Of Theory Of Performance Based Measures Essay

References

Chien, A., Zhonghe, L., & Rosenthal, M. (2010). Improving Timely Childhood Immunizations through Pay for Performance in Medicaid-Managed Care Improving Childhood Immunizations with P4P. Health Services Research, 45(6), 1934-1947.
Faith, J., Panzarella, C., Spencer, R., Williams, C., Brewer, J., & Covone, M. (2010). Use of Performance-Based Contracting to Improve Effective Use of Resources for Publicly Funded Residential Services. Journal of Behavioral Health Services and Research, 37(3), 400-408.
Gemmell, I., Campbell, S., Hann, M., & Sibbald, B. (2009). Assessing workload in general practice in England before and after the introduction of the pay-for-performance contract. Journal of Advanced Nursing, 65(3), 509-515.
Kreiter, C., & Bergus, G. (2009). The validity of performance-based measures of clinical reasoning and alternative approaches. Medical Education, 43(4), 320-326.
Lee, T., Cheng, S., Chen, C., & Lai, M. (2010). A Pay-for-Performance Program for Diabetes Care in Taiwan: A Preliminary Assessment. American Journal of Managed Care, 16(1), 65-69.
Liang, Q. Q. (2007). Performance-based optimization of structures theory and applications. London: Spon Press. Practical Application Of Theory Of Performance Based Measures Essay
Long, J., Helwig-Larsen, M., & Volpp, K. (2008). Patient Opinions Regarding ‘Pay for Performance for Patients’. Journal of General Internal Medicine, 23(10), 1647-1652.
McDonald, R., & Roland, M. (2009). Pay for Performance in Primary Care in England and California: Comparison of Unintended Consequences. Annals of Family Medicine, 7(2), 121-127.
Nicholson, S., Pauly, M., Wu, A. J., Murray, J., Teutsch, S., & Merger, M. (2008). Getting Real Performance Out of Pay-for-Performance. Milbank Quarterly, 86(3), 435-437.
Park, K., Ku, J., Park, I., Park, J., Kim, S., & Kim, J. (2009). Improvement in social competence in patients with schizophrenia: a pilot study using a performance-based measure using virtual reality. Juman Psychopharmacology, 24(8), 619-627.
Peer, J., & Tenhula, W. (2010). Assessment of vocational functioning in serious mental illness: A review of situational assessment and performance based measures. Journal of Vocational Rehabilitation, 32(3), 175-189.

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Ryan, A. (2010). Has Pay-for-Performance Decreased Access for Minority Patients?. Health Services Research, 45(1), 6-23.
Herck, P. V., Smedt, D. D., Annemans, L., Remmen, R., Rosenthal, M., & Sermeus, W. (2010). Systematic review: Effects, design choices, and context of pay-for-performance in health care. BMC Health Services Research, 10, 247-259.
Young, G., Meterko, M., White, B., Sautter, K., Bokhour, B., Baker, E., et al. (2010). Pay-for-Performance in Safety Net Settings: Issues, Opportunities, and Challenges for the Future. Journal of Healthcare Management, 55(2), 132-142.
Brantes, F. d., & D’Andrea, B. G. (2009). Physicians Respond to Pay-for-Performance Incentives: Larger Incentives Yield Greater Participation. American Journal of Managed Care, 15(5), 305-310. Practical Application Of Theory Of Performance Based Measures Essay