Pay for Performance in Emergency Medicine

One of the latest market-based solutions to the rising costs and quality gaps in health care is pay for performance. Pay for performance is the use of financial incentives to promote the delivery of designated standards of care. Pay for performance represents a dramatic change in the reimbursement of providers, from fixed rates or fees, to variable compensation based on the quality of care. This article serves as an introduction to pay for performance. I discuss the goals and structure of pay for performance plans and their limitations and potential consequences in the health care arena. A particular focus is provided on pay-for-performance initiatives affecting the emergency department either directly by contracting at the group level or indirectly through hospital reward programs. I also provide a strategy to guide constructive engagement by emergency physicians in the pay-for-performance movement.