Emerging issues of pay-for-performance in health care.

In the 1990s, managed care with capitation was regarded as the policy tool of choice that would control rising health care costs. An explicit emphasis on health care quality was largely absent, as administrative focus was on the cost per member/per month and provider organizations (POs) that fought to capture market share. In the new century, capitation has to some degree receded as the payment tool of preference as new thinking has spread through the health care marketplace. Health care is seen as entering an age in which both quality and efficiency are paramount in the purchase and delivery of health care. Taken together, the dual goals of quality and efficiency lead to a key concept: pay-for-performance (P4P). This concept is also referred to as value-based purchasing (VBP).