Using Behavioral Economics to Create Effective Provider Incentives, Phase 2

Under an earlier Commonwealth Fund grant, the research team investigated how the principles of psychology and behavioral economics could be used to design more effective incentives for health care providers that support better decision-making. For the proposed second phase of work, the team will begin to test some of these principles with Advocate Physician Partners, which recently began reporting performance data to physicians in real time in an attempt to make incentives more salient to providers. Retrospective analyses will explore the impact of this change on a composite of quality-of-care metric. In addition, a randomized controlled trial will test the efficacy of framing incentives as avoidance of losses and increasing the proportion of the incentives based on performance of the group as a whole. The findings should make an important contribution to a fuller understanding of the impact different physician payment incentive designs can have.