How to Pay? Understanding and Using Incentives
Many countries have experimented with alternative ways of paying providers of health care services. This paper illustrates different methods, suggests some of the theoretic advantages and limitations of each, and provides a general theoretical fram...
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Online Access: | http://documents.worldbank.org/curated/en/2004/09/5643905/pay-understanding-using-incentives http://hdl.handle.net/10986/13674 |
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okr-10986-136742021-04-23T14:03:09Z How to Pay? Understanding and Using Incentives Langenbrunner, John C. Xingzhu, Liu ADVERSE SELECTION ALLOCATIVE EFFICIENCY BANK PUBLICATIONS BEDS CAPITATION CHILD HEALTH CHILD HEALTH SERVICES CIVIL SERVANTS CLINICAL OUTCOMES CLINICS COST SHIFTING DISABILITY DISCHARGE DISPENSARIES DOCTORS DRAFTS ECONOMICS EMPLOYMENT ENVIRONMENTAL DEGRADATION ETHICS EXPENDITURES FAMILY PHYSICIANS FEE FOR SERVICE FINANCIAL RISK GENERAL PRACTITIONERS GLOBAL BUDGETS HEALTH CARE HEALTH CARE COSTS HEALTH CARE DELIVERY HEALTH CARE FINANCING HEALTH CARE PROVIDERS HEALTH CARE SERVICES HEALTH CARE SYSTEMS HEALTH CENTERS HEALTH EXPENDITURE HEALTH FACILITIES HEALTH INSTITUTIONS HEALTH INSURANCE HEALTH INTERVENTIONS HEALTH NEEDS HEALTH OUTCOMES HEALTH PROVIDERS HEALTH SECTOR HEALTH SERVICE PROVISION HEALTH SERVICES HEALTH SYSTEM HEALTH SYSTEMS HOSPITAL CARE HOSPITAL COSTS HOSPITAL SERVICES HOSPITALS HUMAN DEVELOPMENT HUMAN RESOURCES IMMUNIZATION IMMUNIZATION COVERAGE INCOME INPATIENT CARE INSURANCE COMPANIES INSURERS INTEGRATION LATIN AMERICAN LESSONS LEARNED LOW-INCOME COUNTRIES MALNUTRITION MANAGED CARE MANAGERS MARGINAL COSTS MEDICAL CARE MEDICAL EQUIPMENT MEDICAL PERSONNEL MORAL HAZARD NONGOVERNMENTAL ORGANIZATIONS NURSES NURSING NURSING HOME CARE NURSING HOMES NUTRITION OUTPATIENT CARE OUTPATIENT SERVICES OVERRUNS PATIENTS PAYMENT SYSTEMS PHYSICIANS PREGNANT WOMEN PRIMARY CARE PROMOTING HEALTH PUBLIC HOSPITALS PUBLIC SECTOR PUBLIC SPENDING QUALITY OF CARE RESOURCE ALLOCATION RURAL HOSPITALS SERVICE DELIVERY SOCIAL INSURANCE SOUTH AMERICAN SUPPLIERS SURGERY WORKING ENVIRONMENT Many countries have experimented with alternative ways of paying providers of health care services. This paper illustrates different methods, suggests some of the theoretic advantages and limitations of each, and provides a general theoretical framework for evaluating alternatives. Over the last two decades, new and more sophisticated payment systems have evolved, with a broadening of units of payment and setting of payments prospectively. The authors discuss the international experience of a number of payment systems, both traditional and more recently developed, including line-item budgeting, salary, fee-for-service, per diem, case-mix adjusted per episode, global budgets and capitation. The authors argue that no one set of incentives will address the multiple objectives of purchasers, providers, and patients. As a result, purchasers and policymakers must understand and address policy objectives explicitly. With more sophisticated systems, part or all of the financial risk is transferred from the purchaser back to the provider and patient. Most observers caution against full risk but encourage some supply-side cost sharing only, with purchaser and provider sharing in risk arrangements to address moral hazard issues. Imposing high copayments or user fees is an alternative, but in developing countries that quickly erodes financial protection. More sophisticated payment systems may also lead to higher transaction costs and necessitate a greater capacity to use information and management systems. Finally, the best planned and implemented payment incentives and systems may fail due to a variety of other and related factors in health care delivery. Unless these issues are addressed, impacts of change in resource allocation and purchasing will be diluted or neutralized. Technicians and policymakers will need to address these potential "chokepoints" in any process of implementation and refinement. 2013-05-30T14:28:47Z 2013-05-30T14:28:47Z 2004-09 http://documents.worldbank.org/curated/en/2004/09/5643905/pay-understanding-using-incentives http://hdl.handle.net/10986/13674 English en_US Health, Nutrition and Population (HNP) discussion paper; CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Working Paper Publications & Research |
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Foreign Institution |
institution |
Digital Repositories |
building |
World Bank Open Knowledge Repository |
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World Bank |
language |
English en_US |
topic |
ADVERSE SELECTION ALLOCATIVE EFFICIENCY BANK PUBLICATIONS BEDS CAPITATION CHILD HEALTH CHILD HEALTH SERVICES CIVIL SERVANTS CLINICAL OUTCOMES CLINICS COST SHIFTING DISABILITY DISCHARGE DISPENSARIES DOCTORS DRAFTS ECONOMICS EMPLOYMENT ENVIRONMENTAL DEGRADATION ETHICS EXPENDITURES FAMILY PHYSICIANS FEE FOR SERVICE FINANCIAL RISK GENERAL PRACTITIONERS GLOBAL BUDGETS HEALTH CARE HEALTH CARE COSTS HEALTH CARE DELIVERY HEALTH CARE FINANCING HEALTH CARE PROVIDERS HEALTH CARE SERVICES HEALTH CARE SYSTEMS HEALTH CENTERS HEALTH EXPENDITURE HEALTH FACILITIES HEALTH INSTITUTIONS HEALTH INSURANCE HEALTH INTERVENTIONS HEALTH NEEDS HEALTH OUTCOMES HEALTH PROVIDERS HEALTH SECTOR HEALTH SERVICE PROVISION HEALTH SERVICES HEALTH SYSTEM HEALTH SYSTEMS HOSPITAL CARE HOSPITAL COSTS HOSPITAL SERVICES HOSPITALS HUMAN DEVELOPMENT HUMAN RESOURCES IMMUNIZATION IMMUNIZATION COVERAGE INCOME INPATIENT CARE INSURANCE COMPANIES INSURERS INTEGRATION LATIN AMERICAN LESSONS LEARNED LOW-INCOME COUNTRIES MALNUTRITION MANAGED CARE MANAGERS MARGINAL COSTS MEDICAL CARE MEDICAL EQUIPMENT MEDICAL PERSONNEL MORAL HAZARD NONGOVERNMENTAL ORGANIZATIONS NURSES NURSING NURSING HOME CARE NURSING HOMES NUTRITION OUTPATIENT CARE OUTPATIENT SERVICES OVERRUNS PATIENTS PAYMENT SYSTEMS PHYSICIANS PREGNANT WOMEN PRIMARY CARE PROMOTING HEALTH PUBLIC HOSPITALS PUBLIC SECTOR PUBLIC SPENDING QUALITY OF CARE RESOURCE ALLOCATION RURAL HOSPITALS SERVICE DELIVERY SOCIAL INSURANCE SOUTH AMERICAN SUPPLIERS SURGERY WORKING ENVIRONMENT |
spellingShingle |
ADVERSE SELECTION ALLOCATIVE EFFICIENCY BANK PUBLICATIONS BEDS CAPITATION CHILD HEALTH CHILD HEALTH SERVICES CIVIL SERVANTS CLINICAL OUTCOMES CLINICS COST SHIFTING DISABILITY DISCHARGE DISPENSARIES DOCTORS DRAFTS ECONOMICS EMPLOYMENT ENVIRONMENTAL DEGRADATION ETHICS EXPENDITURES FAMILY PHYSICIANS FEE FOR SERVICE FINANCIAL RISK GENERAL PRACTITIONERS GLOBAL BUDGETS HEALTH CARE HEALTH CARE COSTS HEALTH CARE DELIVERY HEALTH CARE FINANCING HEALTH CARE PROVIDERS HEALTH CARE SERVICES HEALTH CARE SYSTEMS HEALTH CENTERS HEALTH EXPENDITURE HEALTH FACILITIES HEALTH INSTITUTIONS HEALTH INSURANCE HEALTH INTERVENTIONS HEALTH NEEDS HEALTH OUTCOMES HEALTH PROVIDERS HEALTH SECTOR HEALTH SERVICE PROVISION HEALTH SERVICES HEALTH SYSTEM HEALTH SYSTEMS HOSPITAL CARE HOSPITAL COSTS HOSPITAL SERVICES HOSPITALS HUMAN DEVELOPMENT HUMAN RESOURCES IMMUNIZATION IMMUNIZATION COVERAGE INCOME INPATIENT CARE INSURANCE COMPANIES INSURERS INTEGRATION LATIN AMERICAN LESSONS LEARNED LOW-INCOME COUNTRIES MALNUTRITION MANAGED CARE MANAGERS MARGINAL COSTS MEDICAL CARE MEDICAL EQUIPMENT MEDICAL PERSONNEL MORAL HAZARD NONGOVERNMENTAL ORGANIZATIONS NURSES NURSING NURSING HOME CARE NURSING HOMES NUTRITION OUTPATIENT CARE OUTPATIENT SERVICES OVERRUNS PATIENTS PAYMENT SYSTEMS PHYSICIANS PREGNANT WOMEN PRIMARY CARE PROMOTING HEALTH PUBLIC HOSPITALS PUBLIC SECTOR PUBLIC SPENDING QUALITY OF CARE RESOURCE ALLOCATION RURAL HOSPITALS SERVICE DELIVERY SOCIAL INSURANCE SOUTH AMERICAN SUPPLIERS SURGERY WORKING ENVIRONMENT Langenbrunner, John C. Xingzhu, Liu How to Pay? Understanding and Using Incentives |
relation |
Health, Nutrition and Population (HNP)
discussion paper; |
description |
Many countries have experimented with
alternative ways of paying providers of health care
services. This paper illustrates different methods, suggests
some of the theoretic advantages and limitations of each,
and provides a general theoretical framework for evaluating
alternatives. Over the last two decades, new and more
sophisticated payment systems have evolved, with a
broadening of units of payment and setting of payments
prospectively. The authors discuss the international
experience of a number of payment systems, both traditional
and more recently developed, including line-item budgeting,
salary, fee-for-service, per diem, case-mix adjusted per
episode, global budgets and capitation. The authors argue
that no one set of incentives will address the multiple
objectives of purchasers, providers, and patients. As a
result, purchasers and policymakers must understand and
address policy objectives explicitly. With more
sophisticated systems, part or all of the financial risk is
transferred from the purchaser back to the provider and
patient. Most observers caution against full risk but
encourage some supply-side cost sharing only, with purchaser
and provider sharing in risk arrangements to address moral
hazard issues. Imposing high copayments or user fees is an
alternative, but in developing countries that quickly erodes
financial protection. More sophisticated payment systems may
also lead to higher transaction costs and necessitate a
greater capacity to use information and management systems.
Finally, the best planned and implemented payment incentives
and systems may fail due to a variety of other and related
factors in health care delivery. Unless these issues are
addressed, impacts of change in resource allocation and
purchasing will be diluted or neutralized. Technicians and
policymakers will need to address these potential
"chokepoints" in any process of implementation and refinement. |
format |
Publications & Research :: Working Paper |
author |
Langenbrunner, John C. Xingzhu, Liu |
author_facet |
Langenbrunner, John C. Xingzhu, Liu |
author_sort |
Langenbrunner, John C. |
title |
How to Pay? Understanding and Using Incentives |
title_short |
How to Pay? Understanding and Using Incentives |
title_full |
How to Pay? Understanding and Using Incentives |
title_fullStr |
How to Pay? Understanding and Using Incentives |
title_full_unstemmed |
How to Pay? Understanding and Using Incentives |
title_sort |
how to pay? understanding and using incentives |
publisher |
World Bank, Washington, DC |
publishDate |
2013 |
url |
http://documents.worldbank.org/curated/en/2004/09/5643905/pay-understanding-using-incentives http://hdl.handle.net/10986/13674 |
_version_ |
1764424181735227392 |