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Med Care. 2015 Feb;53(2):106-15. doi: 10.1097/MLR.0000000000000264.

Cost-effectiveness of diabetes pay-for-performance incentive designs.

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*Department of Public Health, Kaohsiung Medical University, Kaohsiung, Taiwan †National Health Insurance Administration, Ministry of Health and Welfare, Taipei ‡Division of Endocrinology and Metabolism, Graduate Institute of Medical Genetics, College of Medicine, Kaohsiung Medical University, Kaohsiung Medical University Hospital, Kaohsiung, Taiwan §National Marrow Donor Organization, Edina, MN ∥Department of Healthcare Administration and Medical Informatics, Kaohsiung Medical University ¶Department of Business Administration, National Sun Yat-Sen University, Kaohsiung, Taiwan.



Taiwan's National Health Insurance (NHI) Program implemented a diabetes pay-for-performance program (P4P) based on process-of-care measures in 2001. In late 2006, that P4P program was revised to also include achievement of intermediate health outcomes.


This study examined to what extent these 2 P4P incentive designs have been cost-effective and what the difference in effect may have been.


Analyzing data using 3 population-based longitudinal databases (NHI's P4P dataset, NHI's claims database, and Taiwan's death registry), we compared costs and effectiveness between P4P and non-P4P diabetes patient groups in each phase. Propensity score matching was used to match comparable control groups for intervention groups. Outcomes included life-years, quality-adjusted life-years (QALYs), program intervention costs, cost-savings, and incremental cost-effectiveness ratios.


QALYs for P4P patients and non-P4P patients were 2.08 and 1.99 in phase 1 and 2.08 and 2.02 in phase 2. The average incremental intervention costs per QALYs was TWD$335,546 in phase 1 and TWD$298,606 in phase 2. The average incremental all-cause medical costs saved by the P4P program per QALYs were TWD$602,167 in phase 1 and TWD$661,163 in phase 2. The findings indicated that both P4P programs were cost-effective and the resulting return on investment was 1.8:1 in phase 1 and 2.0:1 in phase 2.


We conclude that the diabetes P4P program in both phases enabled the long-term cost-effective use of resources and cost-savings regardless of whether a bonus for intermediate outcome improvement was added to a process-based P4P incentive design.

[Indexed for MEDLINE]

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