Using Behavioral Economics to Design Physician Incentives That Deliver High-Value Care.

Journal Article (Journal Article)

Behavioral economics provides insights about the development of effective incentives for physicians to deliver high-value care. It suggests that the structure and delivery of incentives can shape behavior, as can thoughtful design of the decision-making environment. This article discusses several principles of behavioral economics, including inertia, loss aversion, choice overload, and relative social ranking. Whereas these principles have been applied to motivate personal health decisions, retirement planning, and savings behavior, they have been largely ignored in the design of physician incentive programs. Applying these principles to physician incentives can improve their effectiveness through better alignment with performance goals. Anecdotal examples of successful incentive programs that apply behavioral economics principles are provided, even as the authors recognize that its application to the design of physician incentives is largely untested, and many outstanding questions exist. Application and rigorous evaluation of infrastructure changes and incentives are needed to design payment systems that incentivize high-quality, cost-conscious care.

Full Text

Duke Authors

Cited Authors

  • Emanuel, EJ; Ubel, PA; Kessler, JB; Meyer, G; Muller, RW; Navathe, AS; Patel, P; Pearl, R; Rosenthal, MB; Sacks, L; Sen, AP; Sherman, P; Volpp, KG

Published Date

  • January 2016

Published In

Volume / Issue

  • 164 / 2

Start / End Page

  • 114 - 119

PubMed ID

  • 26595370

Pubmed Central ID

  • 26595370

Electronic International Standard Serial Number (EISSN)

  • 1539-3704

International Standard Serial Number (ISSN)

  • 0003-4819

Digital Object Identifier (DOI)

  • 10.7326/m15-1330


  • eng