• 13 Apr 2023
• 2023

CELG seminar: What is wrong with pay-for-performance initiatives? On the need for a broader and inclusive theoretical perspective

Dear Lecturers, Researchers and Students,

The College of Economics, Law and Government would like to respectfully invite lecturers/ researchers to come and share your experiences at the CELG seminar:

Topic: What is wrong with pay-for-performance initiatives? On the need for a broader and inclusive theoretical perspective

Presenter:Prof. Ardeshir Sepehri,University of Manitoba

Time: 10:30 AM (Vietnam), Thursday, April 13, 2023

Location: Room B1-1001, 279 Nguyen Tri Phuong St, Ward 5, Dist 10, HCMC

Despite the growing enthusiasm for, and adoption of pay-for-performance (P4P) as a means to align the incentives of healthcare providers with public health goals, the current evidence is too weak to draw general conclusions on their effectiveness. While some commentators have attributed P4P’s limited success to a weak program design and implementation, others have flagged flaws in P4P’s underlying conceptual framework and assumptions as more fundamental.

Pay incentives based on a narrowly focused set of services may divert the provider’s effort from the less accurately measured services towards the more accurately measured services, from unrewarded services towards the rewarded services, and from less lucrative rewarded services towards more lucrative reward services, making the impact of pay incentives on the level of each services ambiguous. Perhaps, more fundamental, the narrow and mechanistic reward-induced performance view of worker behavior strips away worker motivation of its goals, motives and values related to fulfillment and self-satisfaction and hence overlooking the perverse effects that pay incentive may have on worker’s intrinsic motivation. This commentary focuses on the later line of criticism, and argues that the motivation processes in work place is more complex than the simple intrinsic-extrinsic dichotomy suggested by the literature. Extrinsic motivation may take various distinct forms that can vary in degree in which they can be relatively controlled by external factors or that can be relatively self-regulated. These conceptual limitations point in the relevance of a broader perspective in the analysis of work motivation and its determinants. 

Keywords: pay-for-performance, financial incentives, healthcare providers; worker motivation; unintended consequences 

About presenter:

Ardeshir Sepehri is Professor in the Department of Economics at University of Manitoba, Canada. He received a Ph.D. in Economics from the University of Alberta, Canada. His research interests lie in health care utilization and financing in developing countries. The overarching theme of his research examines the impact of Vietnam’s national health insurance system on out-of-pocket expenditures.

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Yours sincerely,

CELG