The tougher the better: an economic analysis of increased payment thresholds on the performance of general practices

We investigate whether and how a change in performance-related payment motivated General Practitioners (GPs) in Scotland. We evaluate the effect of increases in the performance thresholds required for maximum payment under the Quality and Outcomes Framework in April 2006. A difference-in-differences estimator with fixed effects was employed to examine the number of patients treated under clinical indicators whose payment schedules were revised and to compare these with the figures for those indicators whose schedules remained unchanged. The results suggest that the increase in the maximum performance thresholds increased GPs' performance by 1.77% on average. Low-performing GPs improved significantly more (13.22%) than their high-performing counterparts (0.24%). Changes to maximum performance thresholds are differentially effective in incentivising GPs and could be used further to raise GPs' performance across all indicators.