The Implications of “Pay-for-Performance” Reimbursement for Otolaryngology—Head and Neck Surgery

Abstract

OBJECTIVE: To introduce otolaryngologists to outcomes-linked reimbursement (“pay-for-performance”), identify clinical practice implications, and recommend changes for successful transition from the traditional “pay-for-effort” reimbursement model. STUDY DESIGN: Policy review. RESULTS: Payers are actively linking reimbursement to quality. Since the Institute of Medicine issued its report on medical errors in 1999, there has been much public and private concern over patient safety. In an effort to base health care payment on quality, “pay-for-performance” programs reward or penalize hospitals and physicians for their ability to maintain standards of care established by payers and regulatory groups. More than 100 such programs are operational in the United States today. This reimbursement model relies on detailed documentation in specific patient care areas to facilitate evaluation of outcomes for purposes of determining reimbursement. Because performance criteria for reimbursement have not yet been proposed within otolaryngology—head and neck surgery, otolaryngologists must be involved to ensure the adoption of reasonable goals and development of reasonable systems for documentation. CONCLUSION: “Pay-for-performance” reimbursement is increasingly common in the current era of outcomes-based medicine. It will assume an even greater role over the next 3 years and will directly affect most otolaryngologists.