Physicians' incentives, patients' characteristics, and quality of care: a systematic experimental comparison of performance-pay systems.

ABSTRACT: How performance pay affects physicians' medical service provision and the quality of care is relevant for researchers and policy-makers alike. This paper systematically studies how performance pay, complementing either fee-for-service or capitation, affects physicians' medical service provision and the quality of care for heterogeneous patients. Using a series of controlled behavioral experiments with physicians and students, we test the incentive effect of performance pay at a within-subject level. We consider a performance pay scheme which grants a discrete bonus if a quality threshold is reached, which varies with the patients' severity of illness. We find that performance pay significantly reduces non-optimal service provision and enhances the quality of care. Effect sizes depend on th

SUBMITTER: Brosig-Koch J 

PROVIDER: S-EPMC12360989 | biostudies-literature | 2025 Jun

REPOSITORIES: biostudies-literature