The Future of Bioethics: Some Ethically Ambiguous Implications of Pay for Performance

1. The Future of Bioethics: Some Ethically Ambiguous Implications of Pay for Performance Jan C. Heller, PhD Director, Ethics and Spiritual Care 8 May 2013

2. Introduction • Today’s title and content informed by… • The Future of Bioethics, by Dr. Howard Brody, Director of the Institute for the Medical Humanities, UTMB, especially chapter 4 on “Evidence-Based Medicine and Pay for Performance” • Discussion also informed by my own research • Brody argues (correctly) that bioethics has, for too far long, been captivated by the dramatic issues surrounding biotechnology research and its applications in clinical areas, and has overlooked important professional and societal issues have, or will have, great implications for health care • I want to acknowledge my debt to Brody, but also alert you that we disagree on pay for performance mechanisms…

3. Introduction • In the end, Brody is against pay for performance mechanisms and I’m (guardedly) in favor of them • Note: Originally, I intended to consider evidence-based medicine as well, but dropped that topic due to time constraints—they’re related, as we’ll see in passing • At issue today: • Whether the assumptions concerning physicians’ self-interest—which are built into pay for performance mechanisms—undermine the very meaning of medical professionalism

4. Presentation outline • Briefly review research on medical professionalism • Currently, a controversial but “hot” topic in academic medicine with important implications for professionals of all types • Consider concerns surrounding pay for performance and some of its implications for medical professionalism • Examine especially the role self-interest in professional decision making • For an in-depth discussion, see JC Heller, “Medical Professionalism, Revenue Enhancement, and Self-Interest: An Ethically Ambiguous Association,” HEC Forum 24, No. 4 (December 2012): 307-315.

5. Characterizing Professionalism • We begin with a caveat… • There is no one way to characterize professionalism in general or medical professionalism in particular • Professions are socially constructed in interaction with each other and other political and economic institutions • Thus, efforts to define and assess professionalism are likely to change over time and space, and these definitions and assessments may be contested • MA Martimianakis, et al., Sociological Interpretations of Professionalism, Medical Education, 2009; 43: 829-837.

6. Characterizing Professionalism • Sociologically, a profession can be understood as one of three, ideal-typical “logics” that contemporary societies use to organize and control work • Control is key to understanding these types, but it is their interaction that is at the heart of the debate around medical professionalism right now • E Freidson, Professionalism: The Third Logic (University of Chicago Press, 2001).

7. Characterizing Professionalism • Two definitions… • “…the occupational control of work.” • E Freidson, Professionalism: The Third Logic , 2001. • A profession…is an occupation that regulates itself through systematic, required training and collegial discipline; that has a base in technical, specialized knowledge; and that has a service rather than profit orientation enshrined in its code of ethics. • Note the ethical emphasis in this second definition… • P Starr, The Social Transformation of American Medicine, 1982.

8. Characterizing Professionalism • Specialized work in an officially recognized economy grounded in theoretically-based discretionary knowledge and skill (i.e., work) given specially recognized status in labor force • Exclusive jurisdiction in particular division of labor created and controlled by occupational negotiation • Sheltered position in the labor market based on qualifying credentials created by the occupation • Formal training program outside of the labor market that produces the qualifying credentials, controlled by the occupation and associated with higher education • Ideology that asserts greater commitment to doing good work than to economic gain and to quality rather than efficiency of work • E Freidson, Professionalism: The Third Logic (University of Chicago Press, 2001).

9. Characterizing Professionalism • Now, an operational and normative definition of medical professionalism… • “Professionalism is demonstrated through a foundation of clinical competence, communication skills, and ethical and legal understanding, upon which is built the aspiration to and wise application of the [four] principles of professionalism: excellence, humanism, accountability, and altruism.” • L Arnold and DT Stern, “What is Medical Professionalism?,” in Measuring Medical Professionalism (Oxford University Press, 2006), p. 19.

10. Characterizing Professionalism • Note that this definition of medical professionalism includes competencies, attitudes, and behaviors, but does not mention of discretionary control of work… • Note also the emphasis on altruism… • Roughly defined, altruism is an unselfish regard for the welfare or good of others (i.e., it is other-regarding, and not self-interested) • Does/Could this altruism imply that physicians should never act out of self-interested motives or intentions? Is that humanly possible? • Hold these questions…Pay for performance assumes physicians will act for self-interested reasons

11. Pay for Performance • How it works… • Combines the “logics” of the market and managerial incentives to link payment for physicians with evidence-based treatment decisions • In essence, it links physician self-interest (market) to standardized treatment guidelines (bureaucracy) with medical decision making (profession) • Versus… • Traditional fee for service (incentives for over treatment) and capitated payments mechanisms (incentives for under treatment) • The intent is improve quality and lower costs by aligning physicians’ self-interest with traditional professional goals

12. Pay for Performance • Concerns raised in the literature… • Many common treatments not (yet) based on good scientific evidence • Poorly designed incentives divert attention from actual need • Rewarding a quality threshold vs. overall patient improvement may lead some to neglect those aspects of care that are not measured • Outcomes could be improved by refusing to treat poorer or sicker patients, potentially broadening already existing disparities • Funds saved by greater efficiencies may not be returned to patient care • MA Hendrickson, “Pay for Performance and Medical Professionalism,” Quality Management in Health Care 17, No 1, pp. 9-18.

13. Pay for Performance • Other concerns… • Non-medical professionals with financial interests may inappropriately influence system design • Systems with poor risk-adjustments may encourage disparities • Incentives that are too large might encourage unethical behaviors • Data collection may undermine patient privacy and confidentiality • Incentives may lead to charting and coding manipulation • Scoring physicians may lead to competition rather than collaboration with colleagues • Measures for specialty care will need to be coordinated with other types of care • A Qaseem, et al., “Pay for Performance Through the Lens of Medical Professionalism,” Ann Intern Med. 2010; 152:366-369.

14. Pay for Performance • But, these concerns are largely theoretical, and thus not inevitable; they also come with opportunities attached to them… • Strong motivator when measures are evidence-based and linked to payment rewards • Measures could include both patient outcomes and patient satisfaction • Better transparency of results may actually enhance patient trust • Measures could encourage better preventive care • Well designed risk adjustments will not discourage care of sicker and poorer patients • Incentives could encourage sharing of knowledge and experience, encouraging collaborative teamwork

15. Pay for Performance • In sum, incentives might increase physician pay while, indeed, improving professionalism under pay for performance… • Increased patient satisfaction scores could bring more patients through the clinic doors • Decreased risk of errors could save capitated funds, some of which could be returned as revenue to physicians • More appropriate treatments, more of the time, could lead to better-treated, more satisfied patients • Better coordination of care across teams and settings could lead to greater efficiencies

16. Some Implications • Short-term: • Increased costs (developing evidence-based knowledge) and misaligned incentives (until incentives are perfected) • Increased revenue (perhaps) for physicians unevenly shared • Mid-term: • Pay for Performance might actually work! • Long-term: • But, encroachment of market and bureaucratic mechanisms may overwhelm or undermine professional discretion (i.e., control of physicians’ work)

17. Return to Medical Professionalism… • Could this work if physicians must always be altruistic? • My suggestion… • Shift ethical debate from altruism vs. self-interest to permissible vs. impermissible forms of self-interest • E.g., Rule-out testing vs. testing to increase revenue • Assume physicians are self-interested, but when acting as professionals can learn (and be incentivized), when appropriate, to set aside self-interest in favor of their patient’s interests • So, don’t argue about physician altruism alone; we should argue about impermissible forms of self-interest

18. Some Concluding Thoughts • “…professional activity will be most responsive to organisational goals implemented and monitored by management to the extent that professionals are enabled to serve the goals internal to their profession.” • “Professional excellence will be most profitable when professionals do not have to mind [think] about being profitable.” • H Reinders, “Internal and External Good: A Philosophical Critique of the Hybridization of Professionalism,” Journal of Intellectual Disability Research, 52, Part 7 (July 2008): 634-638, emphasis added.