The Integrated Healthcare Association (IHA) recently released a report that details lessons learned from the first five years of its Pay for Performance (P4P) program, the nation’s largest and most comprehensive quality incentive program for physicians. The report also lays out a strategic plan for the next five years.

Each year participating physician groups are awarded bonus payments for reaching evidence-based performance goals in three categories: clinical results, patient experience, and investment in information technology. From 2003 to 2004—the two years for which performance results have been analyzed—clinical results and patient experience scores improved 1 to 10 percent across the various measures in each of the two categories. Far more dramatic improvement was made in IT adoption, with a 54 percent increase in groups qualifying for IT credit.

Two hundred and twenty five physician groups representing 35,000 doctors providing care for 6.2 million HMO patients in California are participating in the P4P program. These groups received a combined total of $90 million in performance-related bonus payments from seven participating health plans in 2003 and 2004. Payouts based on 2005 performance will be made later this year.

IHA believes that fundamental components of California’s program are replicable in Medicare and other P4P programs. Key to the program’s success, according to IHA, is the use of standard performance measures across multiple health plans, physician groups, and patient populations.

The program also uses public reporting and peer recognition, as well as payment incentives, to motivate quality improvements. Physician group scores on patient experience measures are reported on the Office of Patient Advocate’s public website.

IHA is a nonprofit collaborative of physicians, health care systems, and health plans. CMA past-president Ronald Bangasser, M.D., has served on IHA’s board since the inception of the P4P program.

CMA believes that while IHA’s P4P program works well for groups, different processes and quality measurement techniques must be developed for solo and small group physicians, many of whom do not have in place the information technology infrastructure necessary to participate in programs that require electronic data reporting. CMA also believes that all quality-related incentive programs must provide for strong physician input on how “quality” is defined and measured, ensure physicians are appropriately reimbursed for clinical care, and protect patient access to care.

Contact: Sandra Bressler, 415/882-5171 or sbressler@cmanet.org.