When financial incentives do more good than harm: a checklist

Financial incentives (pay for performance) for clinicians are an intuitively reasonable solution to the well documented gaps between evidence based best practice and routine care.1 They were fundamental to the 2004 Quality and Outcomes Framework (QOF), which paid primary care physicians in England up to 25% of their income for achieving 147 performance indicators, including 76 clinical targets (such as recording smoking behaviour, keeping blood pressure and cholesterol levels below targets, and spirometry in patients with asthma).2 Whether the cost (around an extra £1bn (€1.3bn; $1.6bn) annually) was justified has been contested.3 Similar attempts include over 170 initiatives in public and private US hospitals,4 and Australia’s Medicare Practice Incentives Program, which targets quality in primary care.5

To aid those making the difficult and costly decision of whether and how to use a financial incentive, we reviewed the evidence on the positive and negative effects of financial incentives and developed a simple checklist.