To date, evidence on pay-for-performance has been mixed. When
pay-for-performance policies improve health outcomes, researchers should
evaluate whether these health gains are worth the incremental costs
(financial incentives and increased utilization) needed to achieve them.
We used simulation modeling to evaluate the cost-effectiveness of two
pay-for-performance policies that were recently evaluated in major
journals: 1) a randomized controlled trial of financial incentives on
patients, physicians, or both for cholesterol control (Asch et al. JAMA
2015); and 2) a retrospective cross-country analysis of the United
Kingdom’s Quality and Outcomes Framework, the world’s largest primary
care pay-for-performance program (Ryan et al. Lancet 2016). We worked
with the authors of these studies to estimate the cost-effectiveness of
these programs and to identify the key drivers (e.g., levels of health
effects, levels of incentive payments, or modeling assumptions) of our
model-based results.