Can payment incentives improve quality and efficiency of care?

Faced with increasing health care costs, America's major corporations are beginning to explore a variety of mechanisms to assure that health care providers are delivering high quality care. The General Motors Corporation (GM), with approximately two million employees, retirees and family members, and annual health care expenditures of approximately $3 billion, has developed a quality review system and a hospital payment mechanism that includes incentives to enhance the quality of care provided to GM beneficiaries. The following article describes this project.