The Need for Improved Payment Systems (Commonwealth Fund Report)

A growing number of health care professionals around the country are increasingly frustrated by health care payment systems that do not reward efforts to improve health care quality, and that often penalize them financially. There is fairly widespread agreement that one reason for high costs and quality gaps is that current health care payment systems impose significant financial penalties and offer disincentives to providers (hospitals, physicians, and others) who supply quality, efficient care (e.g., lower-cost services, higher-quality care, cognitive services, preventive care, etc.), while they offer significant incentives for providing expensive, inefficient care (e.g., invasive treatment, use of technology, etc.) irrespective of outcomes.