What is P4P or Pay-for-Performance?
Blue Cross Blue Shield of Michigan has two hospital incentive-based programs called pay-for-performance, or P4P. Both programs recognize hospitals that excel at care quality, cost-efficiency and population health management. P4P are incentives based on participation and performance in quality and outcome measures. Because OBI is a new CQI, we have more participation measures. The scorecards transition to greater weight on performance as the CQI becomes more established.
In 2019, the program will pay hospitals, in aggregate, an additional 5 percent of statewide inpatient and outpatient operating payments – nearly $190 million statewide.
Hospital performance on most program measures is evaluated on a calendar‐year basis and the P4P rate a hospital earns, based on its 2019 P4P program performance, will be applied to its inpatient and outpatient operating payments, starting July 1, 2020.
The 2019 P4P program year will closely follow the structure, performance measurement and incentive framework of the 2018 program year. The following table summarizes the 2019 P4P program structure: