Effects of financial incentives on medical practice: results from a systematic review of the literature and methodological issues

Int J Qual Health Care. 2000 Apr;12(2):133-42. doi: 10.1093/intqhc/12.2.133.


Objective: To identify all financial incentives that had been proposed, described, or used regardless of their initial objective and, when possible, to assess the results of these incentives on costs, process or outcomes of care.

Material and methods: Systematic review of the literature. Databases searched were: Medline, Embase, Health Planning and Administration, Pascal, International Pharmaceutical Abstracts and the Cochrane Library. Search terms were: health professionals and tape of practice, type of incentive, methodology, languages English or French, January 1993 to May 1999.

Results: Financial incentives concerned the modalities of physician payment and financing of the health care system. Confounding factors included: age of the doctor, training, speciality, place and type of medical practice, previous sanctions for over-prescribing, type and severity of disease, type of insurance. Risks of financial incentives were: limited access to certain types of care, lack of continuity of care, conflict of interests between the physician and the patient. Any form of fund-holding or capitation decreased the total volume of prescriptions by 0-24%, and hospital days by up to 80% compared with fee-for-service. Annual cap on doctors' incomes resulted in referrals to colleagues when target income is reached.

Discussion: Financial incentives can be used to reduce the use of health care resources, improve compliance with practice guidelines or achieve a general health target. It may be effective to use incentives in combination depending on the target set for a given health care programme.

Publication types

  • Research Support, Non-U.S. Gov't
  • Review
  • Systematic Review

MeSH terms

  • Capitation Fee
  • Diagnosis-Related Groups
  • Fee-for-Service Plans / economics
  • Managed Care Programs / economics
  • Physician Incentive Plans / economics*
  • Practice Patterns, Physicians' / economics*
  • Reimbursement, Incentive