Volume 49 | Number 2 | April 2014

Abstract List

Andrew Ryan, Matthew Sutton, Tim Doran


To test whether receiving a financial bonus for quality in the remier ospital uality ncentive emonstration () stimulated subsequent quality improvement.


Hospital‐level data on process‐of‐care quality from ospital ompare for the treatment of acute myocardial infarction (), heart failure, and pneumonia for 260 hospitals participating in the from 2004 to 2006; receipt of quality bonuses in the first 3 years of from the remier nc. website; and hospital characteristics from the 2005 merican ospital ssociation nnual urvey.

Study Design

Under the , hospitals received a 1 percent bonus on edicare payments for scoring between the 80th and 90th percentiles on a composite quality measure, and a 2 percent bonus for scoring at the 90th percentile or above. We used a regression discontinuity design to evaluate whether hospitals with quality scores just above these payment thresholds improved more in the subsequent year than hospitals with quality scores just below the thresholds. In alternative specifications, we examined samples of hospitals scoring within 3, 5, and 10 percentage point “bandwidths” of the thresholds. We used a eneralized inear odel to estimate whether the relationship between quality and lagged quality was discontinuous at the lagged thresholds required for quality bonuses.

Principal Findings

There were no statistically significant associations between receipt of a bonus and subsequent quality performance, with the exception of the 2 percent bonus for in 2006 using the 5 percentage point bandwidth (0.8 percentage point increase,  < .01), and the 1 percent bonus for pneumonia in 2005 using all bandwidths (3.7 percentage point increase using the 3 percentage point bandwidth,  < .05).


We found little evidence that hospitals' receipt of quality bonuses was associated with subsequent improvement in performance. This raises questions about whether winning in pay‐for‐performance programs, such as ospital alue‐Based urchasing, will lead to subsequent quality improvement.