Commentary: Studies show how surgeon decisions follow the money

Editor's Note

Financial incentives can shape surgeons’ decision-making, but their effectiveness depends on the structure of the payment model.

This is the central message of a January 26 article in Forbes reporting on two studies: one linking a sharp increase in hernia cases to a simple Medicare coding change, and another illustrating the failure of financial incentives to motivate urologists to increase active surveillance for low-risk prostate cancer.

The first study, a JAMA research letter, examined the impact of a new Medicare billing code that makes hernia size a factor in reimbursement for abdominal hernia repair cases. Within a year, the percentage of hernias classified as smaller (under three centimeters) dropped from 60% to 49%. Although patient care did not appear to be affected, the shift could reflect more precise measurements—or the potential for financial incentives to influence documentation, possibly leading to overestimation of hernia size, researchers wrote. As detailed in the article, researchers also pointed out that ambiguous clinical decisions can be subject to bias, especially when financial incentives are involved.

The second study, published in JAMA Network Open, assessed a financial incentive program designed to encourage urologists to adopt active surveillance for low-risk prostate cancer instead of immediate treatment. Despite three years of incentives involving more than 15,000 patients, there was no significant increase in active surveillance rates. As detailed by Forbes, this surprised researchers because previous data showed substantial variation in rates. They attribute the results to a requirement for the entire urology group to meet a collective target for physicians to receive the bonus, as well as the potential to make more money by performing biopsies or surgeries instead of pursuing active surveillance.

These findings suggest that when financial rewards are too complex or require group-wide participation, behavior is less likely to change. According to the Forbes contributor, “For all the loud proclamations by payers, providers and policymakers that the U.S. healthcare care system is well on its way to “value-based payment,” the pronouncements about an emphasis on patient preferences and the “cost-quality equation” remain just that empty words when compared to the concrete value signified by an immediate paycheck boost. When a new billing code pays more to individual surgeons, significant change swiftly follows, even if only in documentation. Roll out a convoluted payment scheme that requires an entire surgical group to alter its doctors actually practice, however, and very little happens.”