Aligning Financial and Other Incentives: Principles

The principles below cover four key areas the committee believes are important aspects of any incentive program. There was strong consensus on the first three principles, but there was also a strong recognition that the fourth principle will require more work and more consensus in terms of its implementation. While it is easy to agree with this principle in concept, there is no common agreement or understanding around who benefits from health IT adoption, and by how much they benefit.

Hypothetically, health plans should benefit through better care and cost avoidance due to improved health, but it is unclear how this really occurs and how much the true future savings might be. Physician practices should benefit with greater efficiency and effectiveness at the same payment rate, but no one knows how much efficiency and how much effectiveness. Incentives cannot be meaningful, phased or appropriately aligned until decision-makers have incontrovertible and quantitative information describing the benefits. This means that all payors and providers will need to work together toward meaningful pilots or demonstration projects that are appropriately designed to convincingly measure these benefits before any significant change in financial incentives will occur.

1. Meaningful Incentives: Any financing or incentive program involving health IT should be meaningful and result in improvements in quality, safety, efficiency or effectiveness in health care.
   
   
2. Phased Approach: Financing or incentive programs should utilize a phased approach involving health IT beginning with the implementation of health IT and leading up to the use of electronic information to support performance improvement.
   
   
3. Assure Interoperability: Any financing or incentive program involving health IT should lead to the use of existing standards to assure interoperability.
   
   
4. Cost Reflects the Benefit: Stakeholders that benefit should share some of the cost related to health IT financing or incentives. To achieve this, more study is needed to ascertain specifically who benefits, and by how much. This information is critical to ensuring that incentives programs can be meaningful, phased, and appropriately aligned. In addition, incentive structures should be altered to accommodate those groups that do not have the ability to pay (e.g. underserved populations).