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The Effect of Financial Incentives on Quality of Care: The Case of Diabetes

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  • Anthony Scott

    ()
    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Stefanie Schurer

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Paul H. Jensen

    ()
    (Melbourne Institute of Applied Economic and Social Research, The University of Melbournehor-Workplace-Name: Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Peter Sivey

    ()
    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

Abstract

Australia introduced an incentive payment scheme for general practitioners to ensure systematic and high quality care in chronic disease management. There is little empirical evidence and ambiguous theoretical guidance on which effects to expect on the quality of care. This paper evaluates the impact of the payment incentives on quality of care in diabetes, as measured by the probability of ordering an HbA1c test. The empirical analysis is conducted with a unique data set and a multivariate probit model to control for the simultaneous self-selection process of practices into the payment scheme and larger practices. The study finds that the incentive reform had a positive effect on quality of care in diabetes management and that participation in the scheme is facilitated by the support of Divisions of General Practice.

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Bibliographic Info

Paper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2008n12.

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Length: 30 pages
Date of creation: Jul 2008
Date of revision:
Handle: RePEc:iae:iaewps:wp2008n12

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Cited by:
  1. Fiorentini, Gianluca & Lippi Bruni, Matteo & Ugolini, Cristina, 2013. "GPs and hospital expenditures. Should we keep expenditure containment programs alive?," Social Science & Medicine, Elsevier, vol. 82(C), pages 10-20.
  2. Lippi Bruni, Matteo & Nobilio, Lucia & Ugolini, Cristina, 2009. "Economic incentives in general practice: The impact of pay-for-participation and pay-for-compliance programs on diabetes care," Health Policy, Elsevier, vol. 90(2-3), pages 140-148, May.
  3. G. Fiorentini & E. Iezzi & M. Lippi Bruni & C. Ugolini, 2009. "Incentives In Primary Care and Their Impact on Potentially Avoidable Hospital Admissions," Working Papers 660, Dipartimento Scienze Economiche, Universita' di Bologna.
  4. Gertler, Paul & Vermeerch, Christel, 2013. "Using Performance Incentives to Improve Medical Care Productivity and Health Outcomes," Institute for Research on Labor and Employment, Working Paper Series qt9qn9q7ph, Institute of Industrial Relations, UC Berkeley.
  5. de Walque, Damien & Gertler, Paul J & Bautista-Arredondo, Sergio & Kwan, Ada & Vermeersch, Christel & de Dieu Bizimana, Jean & Binagwaho, Agnes & Condo, Jeanine, 2013. "Using provider performance incentives to increase HIV testing and counseling services in Rwanda," Policy Research Working Paper Series 6364, The World Bank.
  6. Anthony Scott & William Coote, 2010. "Do regional primary-care organisations influence primary-care performance? A dynamic panel estimation," Health Economics, John Wiley & Sons, Ltd., vol. 19(6), pages 716-729.

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