Letters
Health services administration
Volume 197 - Issue 6

Designing incentives for good-quality hospital care

Authors:  Kirstine M Sketcher-Baker, John G Wakefield and Jane V Partridge

Med J Aust 2012; 197 (6): 328. || doi: 10.5694/mja12.11074
Published online: 17 September 2012
To the Editor: In response to Duckett’s question, “is now the time to send a signal that poor-quality care should not be rewarded in activity-based funding?”,1 Queensland Health answers with a resounding “yes”. In addition to activity-based funding (ABF), Queensland Health applies a purchasing framework model with the aim of improving health care safety and quality, leading to better-quality outcomes for the same or lower cost. ...
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To the Editor: In response to Duckett’s question, “is now the time to send a signal that poor-quality care should not be rewarded in activity-based funding?”,1 Queensland Health answers with a resounding “yes”.

In addition to activity-based funding (ABF), Queensland Health applies a purchasing framework model with the aim of improving health care safety and quality, leading to better-quality outcomes for the same or lower cost.2 The 2012–13 model comprises three elements that specifically promote safety and quality improvement, applying financial levers to incentivise improved patient outcomes.3

No payment under ABF applies to “Never events”, or low-frequency events associated with severe harm or death that have very high preventability with existing controls. A discounted payment under ABF applies to low-frequency events associated with temporary or permanent injury that have mid- to high-level preventability with existing controls. Extra payment over ABF takes the form of “quality improvement payments”, or time-limited financial rewards that serve as incentives to bridge practice or evidence gaps. These payments can also provide the basis for developing a local business case for clinical redesign, providing rewards for achieving performance goals.

The introduction of “pay for outcome” funding models comes with challenges, and is the focus of debate. At the heart of this debate is whether the resulting behavioural changes at clinician and managerial levels have a net positive effect on patient outcomes. This is early days for Queensland, and we continue to develop our approach. However, policymakers and clinicians appear committed to work together to use appropriate financial levers to drive behavioural change and improved clinical outcomes.

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