Evaluating the Impact of Performance Funding in Ohio and Tennessee

Health care report cards publicly report information about physician, hospital, and health plan quality in an attempt to improve that quality. Reporting quality information publicly is presumed to motivate quality improvement through 2 main mechanisms. First, public quality information allows patients, referring physicians, and health care purchasers to preferentially select high-quality physicians. Second, public report cards may motivate physicians to compete on quality and, by providing feedback and by identifying areas for quality improvement initiatives, help physicians to do so. Despite these plausible mechanisms of quality improvement, the value of publicly reporting quality information is largely undemonstrated and public reporting may have unintended and negative consequences on health care. These unintended consequences include causing physicians to avoid sick patients in an attempt to improve their quality ranking, encouraging physicians to achieve "target rates" for health care interventions even when it may be inappropriate among some patients, and discounting patient preferences and clinical judgment. Public reporting of quality information promotes a spirit of openness that may be valuable for enhancing trust of the health professions, but its ability to improve health remains undemonstrated, and public reporting may inadvertently reduce, rather than improve, quality. Given these limitations, it may be necessary to reassess the role of public quality reporting in quality improvement.