IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v25y2016i6p706-722.html
   My bibliography  Save this article

The Impact of a Pay‐for‐Performance Scheme on Prescription Quality in Rural China

Author

Listed:
  • Xiaojie Sun
  • Xiaoyun Liu
  • Qiang Sun
  • Winnie Yip
  • Adam Wagstaff
  • Qingyue Meng

Abstract

In this prospective study, conducted in China where providers have traditionally been paid fee‐for‐service, and where drug spending is high and irrational drug prescribing common, township health centers in two counties were assigned to two groups: in one fee‐for‐service was replaced by a capitated global budget (CGB); in the other by a mix of CGB and pay‐for‐performance. In the latter, 20% of the CGB was withheld each quarter, with the amount returned depending on points deducted for failure to meet performance targets. Outcomes studied included indicators of rational drug prescribing and prescription cost. Impacts were assessed using differences‐in‐differences, because political interference led to non‐random assignment across the two groups. The combination of capitated global budget and pay‐for‐performance reduced irrational prescribing substantially relative to capitated global budget but only in the county that started above the penalty targets. Endline rates were still appreciable, however, and no effects were found in either county on out‐of‐pocket spending. Copyright © 2016 John Wiley & Sons, Ltd.

Suggested Citation

  • Xiaojie Sun & Xiaoyun Liu & Qiang Sun & Winnie Yip & Adam Wagstaff & Qingyue Meng, 2016. "The Impact of a Pay‐for‐Performance Scheme on Prescription Quality in Rural China," Health Economics, John Wiley & Sons, Ltd., vol. 25(6), pages 706-722, June.
    • Handle: RePEc:wly:hlthec:v:25:y:2016:i:6:p:706-722
    DOI: 10.1002/hec.3330
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.3330
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.3330?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Yoav Benjamini & Abba M. Krieger & Daniel Yekutieli, 2006. "Adaptive linear step-up procedures that control the false discovery rate," Biometrika, Biometrika Trust, vol. 93(3), pages 491-507, September.
    2. Anderson, Michael L., 2008. "Multiple Inference and Gender Differences in the Effects of Early Intervention: A Reevaluation of the Abecedarian, Perry Preschool, and Early Training Projects," Journal of the American Statistical Association, American Statistical Association, vol. 103(484), pages 1481-1495.
    3. Bonfrer, Igna & Van de Poel, Ellen & Van Doorslaer, Eddy, 2014. "The effects of performance incentives on the utilization and quality of maternal and child care in Burundi," Social Science & Medicine, Elsevier, vol. 123(C), pages 96-104.
    4. Ellen Van de Poel & Gabriela Flores & Por Ir & Owen O'Donnell, 2016. "Impact of Performance‐Based Financing in a Low‐Resource Setting: A Decade of Experience in Cambodia," Health Economics, John Wiley & Sons, Ltd., vol. 25(6), pages 688-705, June.
    5. de Walque, Damien & Gertler, Paul J. & Bautista-Arredondo, Sergio & Kwan, Ada & Vermeersch, Christel & de Dieu Bizimana, Jean & Binagwaho, Agnès & Condo, Jeanine, 2015. "Using provider performance incentives to increase HIV testing and counseling services in Rwanda," Journal of Health Economics, Elsevier, vol. 40(C), pages 1-9.
    6. A. Colin Cameron & Jonah B. Gelbach & Douglas L. Miller, 2008. "Bootstrap-Based Improvements for Inference with Clustered Errors," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 414-427, August.
    7. Adam Wagstaff & Winnie Yip & Magnus Lindelow & William C. Hsiao, 2009. "China's health system and its reform: a review of recent studies," Health Economics, John Wiley & Sons, Ltd., vol. 18(S2), pages 7-23, July.
    8. Timothy Powell‐Jackson & Winnie Chi‐Man Yip & Wei Han, 2015. "Realigning Demand and Supply Side Incentives to Improve Primary Health Care Seeking in Rural China," Health Economics, John Wiley & Sons, Ltd., vol. 24(6), pages 755-772, June.
    9. Karen Eggleston & Li Ling & Meng Qingyue & Magnus Lindelow & Adam Wagstaff, 2008. "Health service delivery in China: a literature review," Health Economics, John Wiley & Sons, Ltd., vol. 17(2), pages 149-165, February.
    10. Lu, Fangwen, 2014. "Insurance coverage and agency problems in doctor prescriptions: Evidence from a field experiment in China," Journal of Development Economics, Elsevier, vol. 106(C), pages 156-167.
    11. Mingsheng Chen & Lijie Wang & Wen Chen & Luying Zhang & Hongli Jiang & Wenhui Mao, 2014. "Does Economic Incentive Matter for Rational Use of Medicine? China’s Experience from the Essential Medicines Program," PharmacoEconomics, Springer, vol. 32(3), pages 245-255, March.
    12. Yip, Winnie & Eggleston, Karen, 2004. "Addressing government and market failures with payment incentives: Hospital reimbursement reform in Hainan, China," Social Science & Medicine, Elsevier, vol. 58(2), pages 267-277, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sambodo, Novat Pugo & Bonfrer, Igna & Sparrow, Robert & Pradhan, Menno & van Doorslaer, Eddy, 2023. "Effects of performance-based capitation payment on the use of public primary health care services in Indonesia," Social Science & Medicine, Elsevier, vol. 327(C).
    2. Dunsch, Felipe Alexander & Velenyi, Edit, 2019. "Job Preferences of Frontline Health Workers in Ghana - A Discrete Choice Experiment," SocArXiv bqx5k, Center for Open Science.
    3. Martin Chalkley & Andrew J. Mirelman & Luigi Siciliani & Marc Suhrcke & Peter Berman, 2020. "Paying for Performance for Health Care in Low- and Middle-Income Countries: An Economic Perspective," World Scientific Book Chapters, in: Paul Revill & Marc Suhrcke & Rodrigo Moreno-Serra & Mark Sculpher (ed.), Global Health Economics Shaping Health Policy in Low- and Middle-Income Countries, chapter 6, pages 157-190, World Scientific Publishing Co. Pte. Ltd..

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jacky MATHONNAT & Aurore PELISSIER, 2017. "How a Results-Based Financing approach can contribute to the health Sustainable Development Goals - Policy-oriented lessons: what we know, what we need to know and don’t yet know," Working Papers P204, FERDI.
    2. Tisamarie B. Sherry & Sebastian Bauhoff & Manoj Mohanan, 2017. "Multitasking and Heterogeneous Treatment Effects in Pay-for-Performance in Health Care: Evidence from Rwanda," American Journal of Health Economics, MIT Press, vol. 3(2), pages 192-226, Spring.
    3. Singh, Neha S. & Kovacs, Roxanne J. & Cassidy, Rachel & Kristensen, Søren R. & Borghi, Josephine & Brown, Garrett W., 2021. "A realist review to assess for whom, under what conditions and how pay for performance programmes work in low- and middle-income countries," Social Science & Medicine, Elsevier, vol. 270(C).
    4. Dennis Egger & Johannes Haushofer & Edward Miguel & Paul Niehaus & Michael Walker, 2022. "General Equilibrium Effects of Cash Transfers: Experimental Evidence From Kenya," Econometrica, Econometric Society, vol. 90(6), pages 2603-2643, November.
    5. Paul Frijters & Asad Islam & Chitwan Lalji & Debayan Pakrashi, 2019. "Roommate effects in health outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 28(8), pages 998-1034, August.
    6. Jeffrey D. Michler & Anna Josephson, 2022. "Recent developments in inference: practicalities for applied economics," Chapters, in: A Modern Guide to Food Economics, chapter 11, pages 235-268, Edward Elgar Publishing.
    7. Cañedo, Ana P. & Fabregas, Raissa & Gupta, Prankur, 2023. "Emergency cash transfers for informal workers: Impact evidence from Mexico," Journal of Public Economics, Elsevier, vol. 219(C).
    8. Islam, Asad & Lee, Wang-Sheng & Nicholas, Aaron, 2021. "The Effects of Chess Instruction on Academic and Non-cognitive Outcomes: Field Experimental Evidence from a Developing Country," Journal of Development Economics, Elsevier, vol. 150(C).
    9. Currie, Janet & Lin, Wanchuan & Meng, Juanjuan, 2014. "Addressing antibiotic abuse in China: An experimental audit study," Journal of Development Economics, Elsevier, vol. 110(C), pages 39-51.
    10. Sara B. Heller & Anuj K. Shah & Jonathan Guryan & Jens Ludwig & Sendhil Mullainathan & Harold A. Pollack, 2017. "Thinking, Fast and Slow? Some Field Experiments to Reduce Crime and Dropout in Chicago," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(1), pages 1-54.
    11. Tian, Xinping & Gong, Jinquan & Zhai, Zhe, 2022. "Natural disasters and human capital accumulation: Evidence from the 1976 Tangshan earthquake," Economics of Education Review, Elsevier, vol. 90(C).
    12. Ahmad Reshad Osmani, 2021. "Conditional Cash Incentive and Use of Health Care Services: New Evidence from a Household Experiment," Journal of Family and Economic Issues, Springer, vol. 42(3), pages 518-532, September.
    13. Dercon, Stefan & Orkin, Kate & Bernard, Tanguy & Taffesse, Alemayehu, 2014. "The Future in Mind: Aspirations and Forward-Looking Behaviour in Rural Ethiopia," CEPR Discussion Papers 10224, C.E.P.R. Discussion Papers.
    14. Sara Heller & Harold A. Pollack & Roseanna Ander & Jens Ludwig, 2013. "Preventing Youth Violence and Dropout: A Randomized Field Experiment," NBER Working Papers 19014, National Bureau of Economic Research, Inc.
    15. Gil Shapira & Ina Kalisa & Jeanine Condo & James Humuza & Cathy Mugeni & Denis Nkunda & Jeanette Walldorf, 2018. "Going beyond incentivizing formal health providers: Evidence from the Rwanda Community Performance‐Based Financing program," Health Economics, John Wiley & Sons, Ltd., vol. 27(12), pages 2087-2106, December.
    16. Cantoni, Enrico & Gazzè, Ludovica & Schafer, Jerome, 2021. "Turnout in concurrent elections: Evidence from two quasi-experiments in Italy," European Journal of Political Economy, Elsevier, vol. 70(C).
    17. Sant’Anna, Pedro H.C. & Zhao, Jun, 2020. "Doubly robust difference-in-differences estimators," Journal of Econometrics, Elsevier, vol. 219(1), pages 101-122.
    18. Pan, Jay & Qin, Xuezheng & Li, Qian & Messina, Joseph P. & Delamater, Paul L., 2015. "Does hospital competition improve health care delivery in China?," China Economic Review, Elsevier, vol. 33(C), pages 179-199.
    19. Michael L. Anderson & Fangwen Lu, 2017. "Learning to Manage and Managing to Learn: The Effects of Student Leadership Service," Management Science, INFORMS, vol. 63(10), pages 3246-3261, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:25:y:2016:i:6:p:706-722. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.