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Home » Past Events » Incentives Sub-Group Meeting

This meeting was hosted by the Division of Community Health Sciences, University of Edinburgh, on 28 June 2005.

How much more treatment do dentists give to their patients when those dentists are paid on fee-for-service contracts (i.e. so much for every filling or extraction) than when they work on a salaried basis? How do GP surgeries work when they operate with a complicated points system that gives them more money for some treatments than others and also allows them to exclude patients from treatment for various reasons? If hospitals are given powers to fine other public authorities (local authority social services departments) for leaving ‘bed-blocking’ patients in acute hospital beds, when do they choose a policy of collaboration with those other authorities rather than an aggressive fining strategy? If liability for actions in tort affects the way hospitals provide health care, how does the pooling of risk for financial liability for such actions affect the quality of that care? Do higher excesses for insurance against tort liability lead to better outcomes in the same way that higher excesses on their insurance policies are assumed to make car drivers more careful?

These fundamental questions about how incentives work in shaping the provision of health services are all being tackled by researchers from the ESRC Public Services programme, and were discussed in a small intensive research seminar at Edinburgh University in June 2005. None of those questions has an obvious answer. Intuitively we expect fee-for-service to make dentists provide more treatment, but how much more – 10%, 25%, 100%? Bed-blocking fines are introduced on the assumption that hospitals will use them to force social care providers to take bed-blockers into other facilities, but under what conditions will that assumption be satisfied? How far will GP surgeries seek to play the points game to maximize their income (for example by playing the exclusion card), to keep their place in a points league against other GP surgeries, or simply respond to their perceptions of patient need as if no points system existed? Does removal of excesses for risk pooling in health provision lead to more inappropriate care – or simply counteract the pressures for defensive medicine that would otherwise exist, such that the combination of risk pooling and legal activism works against the potentially perverse incentives of each of those incentive systems taken on its own?

Getting at the – often non-intuitive – answers to such questions is critical to understanding how incentive systems work for public services in complex organizational settings. Getting the answers depends on finding the right kind of data and matching it with a workable method. For the answer to the question of how far dentists’ behaviour is shaped by the contractual conditions in which they work, a team led by Jan Clarkson at the University of Dundee is putting together anonymised clinical data for a cohort of dentists graduating in the same year for the four countries in the UK, matched with data about the contractual conditions under which different NHS dentists work. For the answer to the question of how GP surgeries respond to a points-based contract system, a team led by Bruce Guthrie, also at the University of Dundee, is combining aggregate data with ethnographic observation-based analysis of the operations of two Scottish GP surgeries. For the answer to the question of how hospitals and social services departments respond to fining systems over bed-blocking, a team led by Allyson Pollock at University College London is putting together four different data sets to explore behaviour in a set of English hospital trusts. For the answer to the question of how risk pooling arrangements affect the nature of health care provision, a team led by Paul Fenn at the University of Nottingham is taking advantage of the ‘natural experiment’ opportunity offered by the removal of insurance excesses from the NHS risk pooling arrangements in 2002 and conducting a ‘before’ and ‘after’ study of a set of performance indicators.

All of these researchers will be reporting their results for the Programme in 2006, and taken together their work will enable the Programme to make a significant contribution to our understanding of how health care systems respond to different forms of incentives, in a way that we hope to compare and contrast with other public services. Everyone nowadays talks about incentives in public services, but government itself rarely if ever tests their effects directly, or even sets up data systems in such a way that those effects show up clearly, so there are major methodological challenges in research that the Edinburgh workshop discussed. Bringing out the effects of different incentive systems systematically, using a range of data sources and analytic methods, is one of the major themes of the Public Services Programme.

View report of the meeting.
View the presentation, ‘Financial Incentives as Discharge Policies, England and Sweden’, by Allyson Pollock (University of Edinburgh).
View the presentation, ‘What Changes When Incentives Change in Primary Medical Care’, by Bruce Guthrie, (University of Dundee).
View the presentation, ‘Creating a Clinical, Economic and Psychological Research Resource’, by Jan Clarkson, Colin Tilley, Martin Chalkley, Linda Young and Debbie Bonetti (University of Dundee).

[All of the above documents are in PDF format.]