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P4P programs feasible in addiction settings


Alcohol and drug dependency treatment goals can tied to an insurer’s pay-for-performance incentive program. Here’s how.

Pay-for-performance (P4P) programs can help improve treatment for drug and alcohol addiction, according to a paper published in the October issue of the Journal of Hospital Administration.

Chemical dependency treatment programs have not been typically considered for or welcoming of P4P approaches.

The Hazelden Betty Ford Foundation (HBFF) and HealthPartners measured whether P4P programs could improve care for drug and alcohol addiction. The measures included seven areas of care. Then, HealthPartners gave financial rewards for meeting the goals. They included:

·        How satisfied patients are

·        How many people attended 12-step meetings

·        How many patients needed more treatment

In the first year, providers met two of the goals. In the second year, they met all seven goals: 1) percentage of patients who report attending 3 or more meetings per week in first 6 months post-discharge from residential treatment; 2) percentage of  residential patients who step down to another Hazelden CD program within 2 weeks of discharge; 3) percentage of patients with "excellent" rating: "Overall quality of care and services" (Center City, Minnesota, site); 4) percentage of patients with "excellent" rating: “Overall quality of care and services" (Plymouth, Minnesota, site); 5) percenrage of patients with "excellent" rating: “Degree to which treatment helped you deal with your addiction problem"; 6) percentage of patients with "excellent" rating: “Degree to which treatment helped you deal with your addiction problem"; and 7) percentage of patients who within one year of completing residential treatment are readmitted for further residential treatment at Hazelden.

As a result, patients had:

•   Better health. The number of patients who said treatment helped increased from 42% to 48%.

•   Increased use of aftercare. The number of patients who attended at least three 12-step meetings each week grew from 41% to 42%.

•   Increased satisfaction. The number of patients who rated the care they received as "excellent" rose from 66% to 72%.

• Fewer readmissions. The number of patients who were readmitted within one year dropped from 6.7% to 6.5%.

P4P has also helped increase generic drug use. In 2002, generic drugs accounted for just 45% of prescriptions. In 2015, 90% of prescriptions were generic.


“Our mutual experience with the pay-for-performance initiative so far indicates that it is very possible for payers and care providers to collaborate successfully on initiatives to improve the quality of patient care,” says lead study author Audrey Klein, executive director, Butler Center Research, HBFF. “This was not a study per se, rather, the paper is a description of how the P4P program was conceived, designed, and implemented. The primary finding reported in the paper is that in year one of the program, very few metrics targets were achieved, whereas by the second year, all targets were achieved. The basic finding is that P4P programs are feasible to implement in addiction treatment settings.”

This is novel and a significant breakthrough for the chemical dependency field, says study author Karen Lloyd, PhD, HealthPartners senior director of behavioral health and resilience.

Partner with providers

“For the benefit and well-being of their members, and to help keep costs down, managed care executives should explore the use of P4P with care providers in the behavioral health space,” says Klein.  


Health plans can partner with chemical dependency providers to construct a P4P approach, according to Lloyd.

“This benefits people who are both members of the health plan and patients of the chemical dependency program,” Lloyd says. “It should be considered as a behavioral health strategy to achieve the Triple Aim of simultaneously working toward the goals of improving health and patient satisfaction and making healthcare more affordable.”

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