Pay for performance is ineffective
The recent article, The impact of removing financial incentives from
clinical quality indicators: longitudinal analysis of four Kaiser
Permanente indicators by Lester, et. al. makes an interesting observation
that performnace declines when financial incentives are withdrawn. This
may appear to argue against withdrawing incentives, but I believe this
argues against financial incentives in general.
We have learned a great deal about what really motivates, and for
most of us, money isn't it. While a secure income is essential, financial
rewards for meeting goals actually degrade our work. This article
supports findings elsewhere* that rewards actually decrease long-term
Our profession needs to rise above P4P. Imagine a report from an air
craft carrier that shows fewer successful landings when bonuses for
reliability are removed! Or that sterility of IV solution goes down when
line workers' incentive bonuses are cancelled! The public expects high
reliability from us, and they deserve to.
Instead of using carrots and sticks, we need to stimulate intrinsic
motivation by ensuring competence; allowing autonomy to innovate and
excel; and connecting performance to the big picture.
Jim Deming, M.D.
*Drive by Daniel Pink and Punished by Rewards by Alfie Kohn
Competing interests: No competing interests