Pay-for-performance (P4P) and public quality-reporting programs offer the potential to increase the quality of health care overall, but they threaten to actually decrease quality for minority and low-income patients in the process. In an article published April 10 on the Health Affairs Web site [free access through April 23], Larry Casalino of the University of Chicago and Arthur Elster of the American Medical Association explain, first, how current incarnations of P4P and reporting programs for physicians could worsen health care quality disparities and, second, how these rapidly proliferating “external incentives” might be revamped to avoid this result. Their article focuses on P4P and public reporting programs for physicians, but they say that similar points apply to external incentives aimed at other types of health care providers, such as hospitals.

Casalino and Elster offer several ways in which P4P and public reporting could actually worsen care for the poor and minorities. Physicians might avoid poor and minority patients if they perceive them, rightly or wrongly, as less likely to have good outcomes from treatment, or less likely to adhere to treatment recommendations. Physicians might also “teach to the test” more with poor and minority patients than with more affluent and nonminority patients. “For example, with a relatively uneducated diabetic patient who speaks poor English, the physician might focus on making sure the patient has a hemoglobin A1c test (because this is measured) but not on the time-consuming” — and unmeasured — “task of explaining to the patient how to control his or her diabetes and blood pressure,” Casalino and Elster write.

Residents of poor and minority neighborhoods could also end up paying more for medical care if health plans charge higher copays to visit “poor-quality” physicians. Physicians in these neighborhoods are “doubly disadvantaged” in achieving high quality scores, Casalino and Elster explain. Their many Medicaid and uninsured patients leave them little revenue to invest in quality improvement, and their patients may be less likely to obtain recommended follow-up treatment and preventive care because of child care or transportation problems or because of failure to understand the recommendations.

Casalino and Elster offer several strategies for increasing the likelihood that P4P and public reporting programs improve quality for poor and minority patients. Examples include using “stratified analysis” to compare physicians’ performance against that of physicians treating similar patients, and risk-adjusting quality scores for health status, as well as for race/ethnicity and/or socioeconomic status.