Centura Health, a 13-hospital system in Colorado, has enjoyed success with pay-for-performance contracts for nearly a decade. Bradley Olson, former director of payer relations and contracting, shares what works-and what does not-in accepting risk based on performance.

  • Use simple measurements that incorporate both the payer's and the health system's goals
  • Set goals that are achievable through operational changes and hard work
  • Do not agree to goals that will be unattainable
  • Ensure that the relevant clinical teams know the baseline measurement and how improvement affects the health system financially
  • Communicate results to those clinical teams as often as possible
  • Reward clinical and quality teams for achieving pay-for-performance goals
  • Have appropriate resources in place to implement a pay-for-performance contract before the contract is signed
  • Ensure the right process is in place to succeed on each goal
  • Monitor progress often
  • Do not get discouraged if you don't achieve the goals every year at 100 percent
  • Set reasonable targets so you can be confident the benefit of pursuing the goal outweighs the resource costs
  • Remember the true goal is better quality care for patients

Return to related Leadership article: The Push to Value-Oriented Payment 

Publication Date: Friday, May 25, 2012