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Disease-Modifying Therapy and Hospitalization Risk in Heart Failure Patients
Fadia T. Shaya, PhD, MPH; Ian M. Breunig, PhD; and Mandeep R. Mehra, MD, FACC, FACP, FRCP
Frequency and Costs of Hospital Transfers for Ambulatory Care-Sensitive Conditions
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Value-Based Insurance Design: Benefits Beyond Cost and Utilization
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Medical Homes: Cost Effects of Utilization by Chronically Ill Patients
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Using Financial Incentives to Improve the Care of Tuberculosis Patients
Cheng-Yi Lee, MS; Mei-Ju Chi, PhD; Shiang-Lin Yang, MS; Hsiu-Yun Lo, PhD; and Shou-Hsia Cheng, PhD

Using Financial Incentives to Improve the Care of Tuberculosis Patients

Cheng-Yi Lee, MS; Mei-Ju Chi, PhD; Shiang-Lin Yang, MS; Hsiu-Yun Lo, PhD; and Shou-Hsia Cheng, PhD
Patients enrolled in the tuberculosis pay-for-performance program received more comprehensive ambulatory care with slightly lower costs and a higher treatment success rate.
Tuberculosis (TB) is a serious public health concern, and Taiwan has implemented a pay-for-performance (P4P) program to incentivize healthcare professionals to provide comprehensive care to TB patients. This study aims to examine the effects of the TB P4P program on treatment outcomes and related expenses.

Study Design
A population-based natural experimental design with intervention and comparison groups.

Propensity score matching was conducted to increase the comparability between the P4P and non-P4P group. A total of 12,018 subjects were included in the analysis, with 6009 cases in each group. Generalized linear models and multinomial logistic regression were employed to examine the effects of the P4P program.

The regression models indicated that patients enrolled in the P4P program had 14% more ambulatory visits than non-P4P patients (P <.001), but there were no differences in hospitalization rates. On average, P4P enrollees spent $215 (4.6%) less on TB-related expenses than their counterparts. In addition, P4P enrollees had a higher likelihood of being successfully treated (odds ratio, 1.56; P <.001) and were less likely to die compared with nonenrollees.

Patients in the P4P program were less likely to die, were more likely to be treated successfully, and incurred lower costs. Providing financial incentives to healthcare institutions could be a feasible model for better TB control.

Am J Manag Care. 2015;21(1):e35-e42
A population-based natural experimental design with propensity score matching was used to examine the effects of a pay-for-performance (P4P) program for tuberculosis (TB) care in Taiwan. Providing financial incentives could be a feasible model for better TB control.
  • Patients enrolled in the TB P4P program received more comprehensive ambulatory care and no differences in emergency department utilization or hospitalization.
  • The P4P enrollees incurred higher TB-related ambulatory care expenses but lower TB-related hospitalization expenses and 4.6% lower total TB-related expenses.
  • The P4P enrollees were more likely to be successfully treated.
Tuberculosis (TB) is a serious public health concern and a major cause of death worldwide, especially in Asia and Africa.1 The United Nations Millennium Development Goals state that prevalence and death rates associated with TB should be halved by 2015.2 To achieve the Millennium Development Goals, target, programmatic, and operational issues have been raised.3 The delivery of TB care through the optimal use of currently available service resources is an issue that deserves attention. Studies are needed to provide evidence of how to improve the use, quality, effectiveness, and coverage of TB interventions.3,4

There are a rapidly growing number of pay-for-performance (P4P) program models linking financial incentives and patients’ healthcare outcomes. Many countries have adopted various types of P4P programs to improve healthcare quality while controlling costs.5 There has also been a growing literature examining the effects of P4P programs, yet considerable debate continues about the effectiveness of P4P programs on healthcare outcomes.6-9 Discrepancies in the findings of the empirical studies might be due to the variations in types of financial incentives implemented, the payer mix, and the baseline level of quality care.10

Taiwan’s TB P4P Program

Among the 23 million residents in Taiwan, the annual incidence rate of TB ranged from 72 to 74 per 100,000 persons from 2004 to 2005, and TB has been the 12th or 13th leading cause of death after 2005, and it is also the most lethal infectious disease.11 In the past, TB patients were mainly treated in designated TB centers in Taiwan; however, not every TB patient was properly managed because some patients were distantly located from one of these centers.12,13 Fortunately, Taiwan implemented the National Health Insurance (NHI) program in 1995. The NHI is mandatory and covers over 99% of the population, and 90% of hospitals and clinics nationwide are contracted with NHI. Under NHI coverage, patients can choose preferred healthcare providers for healthcare needs. Therefore, the Taiwan Centers for Disease Control (Taiwan CDC) decided to expand designated TB treatment units to include any NHI-contracted hospitals that had at least 1 TB or chest specialist. This strategy enabled the healthcare providers to treat TB patients with universal health insurance coverage in Taiwan.

In 2001, the Bureau of NHI implemented a pilot P4P program for TB and several other illnesses (including asthma, diabetes, breast cancer, and cervical cancer) to promote evidence-based follow-up care. Since 2004, the TB P4P program has been administered in cooperation with the Taiwan CDC to simplify bureaucratic processes and claim procedures. NHI-contracted hospitals and clinics (with at least 1 TB or chest specialist) can participate in the TB P4P program voluntarily, and physicians can then enroll their TB patients into the program. The new P4P program increased the participation of healthcare providers in TB control from 68 institutions nationwide in 2002, to 751 hospitals and clinics in 2004.

In addition to the regular NHI fee-for-service payments for treating patients with TB (which include physician counseling fees, medication fees, physical examination fees, and laboratory test fees), hospitals and clinics participating in the P4P program also receive extra payments for recommended services, such as diagnosis confirmation fees and comprehensive follow-up and education fees. Special payment rewards are also made for patients completing treatment. For example, the treatment success reward is 2000 New Taiwan (NT) dollars ($1 US = 30 NT dollars as of 2013) for a case of multidrug-resistant TB, and 1000 NT dollars for a regular TB case. Higher payments for specific laboratory tests are also included.14,15 Detailed information on the monetary amount of the financial incentives of the TB P4P program compared with regular payment for TB treatment is listed in the eAppendix Table (available at The P4P financial incentive for a typical TB case over an 8-month treatment period is at least 5500 NT dollars, or approximately US$183.

Under the P4P program, the TB case managers, mainly registered nurses (part-time or full-time staff members as needed in each hospital), play a major role. Once enrolled in the P4P program, each TB patient is assigned to a case manager and an attending physician. The case managers are responsible for supervising each enrolled patient (ensuring that each takes prescribed medications and appears at scheduled follow-up visits), as well as providing health education to patients. They also serve as the liaison between public health authorities and healthcare institutions. The P4P-participating providers are required to report treatment processes and case management status to the Taiwan CDC, which facilitates intensive follow-up. The P4P payment is reimbursed by the Bureau of NHI after verification by the CDC.

This study extends the existing studies in 2 ways. First, previous studies have evaluated the preliminary effects of the TB P4P program by using NHI claims data to identify TB cases,16,17 and the healthcare expenses have not yet been evaluated. Furthermore, only limited outcomes measures have been reported regarding communicable diseases.18 Second, the majority of previous studies on P4P programs and healthcare outcomes were conducted in diverse settings in the United States. However, the US healthcare system is characterized by multiple payers; physicians may contract with a number of commercial insurance companies, Medicaid health maintenance organizations, or Medicare groups.

In addition, most P4P programs include relatively small-scale financial intervention—only a few P4P initiatives have expanded to include national coverage in the US healthcare system. Small-scale financial incentive interventions, either from payers or purchasing coalitions, may not capture the attention of physicians.19 Conversely, Taiwan has implemented a P4P program with a national scope under a universal coverage healthcare system, which provides a favorable research setting to investigate the effects of a P4P program. Therefore, the purpose of this study was to evaluate the effects of the TB P4P program on healthcare expenses and treatment outcomes under a universal coverage system in Taiwan.


The NHI P4P program for TB was introduced in 2001. According to Taiwan’s Communicable Disease Control Act, doctors are required to report suspected or confirmed TB cases to the Taiwan CDC within 7 days after diagnosis. To avoid the possible confounding effect of the severe acute respiratory syndrome outbreak in 2003 and the Directly Observed Treatment, Short-Course program—the WHO-recommended treatment model for TB—which was implemented in 2006 in Taiwan, this study only analyzed the TB cases confirmed in 2004 and the healthcare expenses incurred in 2004 and 2005.

This was a population-based retrospective study. The data used in this study were acquired from the Taiwan CDC’s national TB control database; all cases reported and confirmed in 2004 were included in the analysis. Data for healthcare utilization and expenses during 2004 and 2005 came from the NHI claims database. The 2 data sets were linked by the subjects’ personal identification numbers, and the study was approved by the academic research units of the Taiwan CDC.

To minimize the differences between the characteristics of the patients in the intervention (P4P) and comparison (non-P4P) groups, propensity score matching was adopted in the analysis. We created propensity scores that predicted the probability of patients’ enrollment in the P4P program. The covariates included patient characteristics (eg, age, sex, residence area, aboriginal status, Charlson Comorbidity Index [CCI] score, sputum status) and characteristics of healthcare providers (eg, ownership and accreditation level). We employed the Mahalanobis distance calculation method with 1:1 matches between the intervention group and the comparison group based on the propensity score.

Variables of Interest

The dependent variables examined in this study were healthcare utilization, healthcare expenses, and treatment outcomes. TB-related healthcare utilization and expenses were identified by the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) codes of 010-018 as the primary or secondary diagnosis in the NHI claims database. Healthcare utilization included the number of outpatient visits, emergency department (ED) visits, and hospitalizations related to TB. Healthcare expenses included the expenses for all TB-related outpatient visits, ED visits, and hospitalizations, as well as the total TB-related healthcare expenses incurred by the patients. Finally, the treatment outcomes were classified into treatment success, death, or unfavorable outcomes (ie, lost to follow-up, treatment failure, or still under treatment).

Statistical Analyses

A generalized linear model with logarithmic link and negative binominal distribution was used to estimate the effects of the P4P program on the number of outpatient visits, the number of ED visits, and the number of hospitalizations. The values for healthcare expenses were right-skewed; therefore, we used a generalized linear model with logarithmic link and gamma distribution. The predicted values of healthcare expenses from the regression models were calculated to illustrate the results obtained in the 2 study groups. Finally, we used multinomial logistic regression to examine the effects of the P4P program on treatment outcomes. We used the NCSS (version 2007, Kaysville, Utah) for the propensity score matching and SAS (version 9.1, Cary, North Carolina) for statistical analysis. A P value of less than .05 indicates statistical significance.


A total of 16,784 cases of TB were reported to and confirmed by the Taiwan CDC in 2004. The cases with foreign identification numbers or the identification numbers that had no matches in the NHI claims database (N = 1227) were excluded. There were 15,557 subjects included in the analysis. These subjects were treated in 374 hospitals and 377 clinics in 2004; the majority of these cases were treated in hospitals.

The majority of the TB subjects were male (69.3%), living in nonindigenous (91.9%) and nonaboriginal groups (93.5%), and 48.3% were 65 years and older. Concerning the subjects’ disease characteristics, 56.4% had positive sputum tests, and 58.5% had a CCI score equal to or greater than 1. About 50.6% of the subjects received TB treatment in public or government-run healthcare institutions, and 58% were treated in the outpatient departments of medical center hospitals and regional hospitals, which are referral hospitals (compared to more local district hospitals and clinics).

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