Why 'nudging' physicians, giving them more money isn't enough to improve patient outcomes

Despite enthusiasm over financial incentives and behavioral "nudges" to push physicians toward more evidence-based care, healthcare leaders need to think more broadly about their institution's organizational culture to see lasting improvements in patient outcomes, two professors of medicine at UC Los Angeles argue in Harvard Business Review.

Here are six insights from the op-ed, written by Yusuke Tsugawa, MD, PhD, and John Mafi, MD:

1. Although numerous studies show financial incentives, such as pay for performance, can be effective at improving care processes, they are often ineffective in improving patient outcomes, including patient mortality rates, the authors said.

"Relying too heavily on financial incentives to boost performance can often lead to gaming of metrics (e.g., up-coding patient complexity to reduce readmission penalties) or harmful unintended consequences," the authors wrote. "For example, paying health systems and doctors to prescribe beta-blocker medications in patients with heart disease frequently leads to overprescribing, even when they are unsafe, and such overprescribing can lead to disastrous consequences for patients."

2. These financial incentives could also undermine providers' intrinsic motivation or distract them from the number of other responsibilities they hold, the authors said. "Clinicians already have so many increasing and competing demands on their time that adding another initiative [even one that offers financial rewards] may not be well received."

3. "To be sure, it's important to note that financial and behavioral frameworks, while imperfect, can still help move the needle toward better decision-making and evidence-based practice," the authors wrote. "However, leaders and clinicians should also understand that these frameworks are no panacea and be open to other approaches for driving change."

4. To address this issue, the authors urge leaders to focus on engaging their clinicians and more closely examine their organizational culture. Organizational culture is defined as the system of shared assumptions, values, beliefs and norms within an environment — all factors that can significantly affect clinician work and patient outcomes, according to the authors.

"When clinicians are encouraged to creatively solve problems and improve processes, when they feel comfortable speaking up about problems and mistakes, and when they have support from senior leadership, they are often more motivated to make positive changes that can improve the quality of care and patient outcomes," the authors wrote.  "On the other hand, if the culture is weak — if clinicians report lack of support from managers or a generally poor work environment, patients tend to have worse outcomes."

5. The authors cited several studies where initiatives to improve organizational culture led to better care. In one study, of 10 hospitals over a two-year period, researchers found positive culture change through an intervention to empower staff to save more lives was linked to 1 percent lower hospital mortality ratesAnother study found hospital care quality was positively correlated with hospital leaders who engage frontline clinicians, support clinicians in improvement efforts and build a blame-free environment.

6. "Healthcare leaders who are committed to improving clinical care must assess their local organizational cultures and identify opportunities for improvement," the authors wrote. The authors cited multiple resources for initiating culture interventions, including the Institute for Healthcare Improvement and the Taking Action on Overuse framework.

"While monetary incentives and behavioral 'nudges' both have their strengths, neither of them is sufficient to reliably change clinician behavior and improve the quality of their care," the authors concluded. "Organizational culture, while diverse and complex, provides another important lens to understand why clinicians are practicing in a certain way and to put forth more comprehensive, long-term solutions."

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