What is the main issue with pay-for-performance programs from the behavioral economics point of view? Pay-for-performance programs would help drive the behavior of providers and health care systems to improve the quality of care delivered, reduce unnecessary use of expensive health care services, and improve patient health outcomes They penalize health care providers for poor outcomes, medical errors or increased costs. They imply that providers are perfectly rational: providers just needed the right monetary incentive to improve performance
What is the main issue with pay-for-performance programs from the behavioral economics point of view? Pay-for-performance programs would help drive the behavior of providers and health care systems to improve the quality of care delivered, reduce unnecessary use of expensive health care services, and improve patient health outcomes They penalize health care providers for poor outcomes, medical errors or increased costs. They imply that providers are perfectly rational: providers just needed the right monetary incentive to improve performance
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Transcribed Image Text:### Understanding Pay-for-Performance in Healthcare from a Behavioral Economics Perspective
**Question:**
What is the main issue with pay-for-performance programs from the behavioral economics point of view?
**Options:**
1. **Option 1:**
Pay-for-performance programs would help drive the behavior of providers and healthcare systems to improve the quality of care delivered, reduce unnecessary use of expensive healthcare services, and improve patient health outcomes.
2. **Option 2:**
They penalize healthcare providers for poor outcomes, medical errors, or increased costs.
3. **Option 3:**
They imply that providers are perfectly rational: providers just needed the right monetary incentive to improve performance.
### Explanation:
This question explores the potential downsides of pay-for-performance models in healthcare. Behavioral economics suggests that these programs assume healthcare providers will respond solely to financial incentives, which may not always lead to the best outcomes.
Expert Solution
Step 1: Pay-for-performance
Employees are paid for reaching specified performance objectives under the pay-for-performance (P4P) payment model. These goals might be personal, communal, or institutional in nature. P4P programmes are often used in the healthcare business to compensate providers for improving service effectiveness and quality.
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