Getting the incentives right for children

One way to improve the functioning of the American child healthcare system is through the design of incentives. Objective: to examine what we know and need to know about designing incentives to encourage the production of high-quality care both for healthy children and for children with serious illnesses.

For healthy children, incentives should encourage the provision of preventive services, including services that encourage healthy behavior. For children with serious illnesses, incentives should reduce risk selection, promote collaborative systems of care, and ensure access to appropriate specialty services. Research findings needed for incentive design includes information on the actual working of existing incentive mechanisms as well as information about risk adjustment, mixed payment system, carve-outs, and other mechanisms to reduce risk selection; options for defining service scope that encourage collaboration; and information about the ways in which quality measurement interacts with payment incentives.