D6.7 – Overview of the literature on incentives for hospitals
Hospitals are not paid in one single way. Some receive a fixed sum for every patient treated, calculated according to the diagnosis; some receive a lump sum for each day the patient stays; others work within an annual budget agreed in advance, or earn a bonus if they meet quality targets and a penalty if too many patients come back through the door. None of these arrangements is neutral. Each one quietly rewards some behaviours and discourages others, influencing how many patients a hospital admits, how long they stay, how carefully their diagnosis is recorded and how much the whole system ends up spending. Researchers have been testing these effects for years, in dozens of countries and with very different methods. What has been missing is a clear picture of what all that research adds up to.
This deliverable assembles that picture. It is a systematic review conducted according to PRISMA guidelines, searching PubMed and Cochrane alongside reports from the World Health Organization, the Health Observatory, the OECD and the World Bank, and covering publications from 2013 to 2023. Studies were included only if they concerned hospitals and inpatient care, examined a specific payment or financing intervention, and measured a concrete outcome such as provider behaviour, treatment quality, waiting times, patient numbers or spending. Titles, abstracts and full texts were screened independently by three pairs of analysts, with disagreements resolved by consensus. The result is a body of 171 studies covering 24 countries, synthesised narratively rather than through meta analysis because the underlying designs and health systems are too heterogeneous to pool. Each study is then classified along two dimensions built from the OECD and WHO and Urban Institute frameworks: the payment mechanism at stake, grouped into activity based payment such as fee for service, per diem and DRG, budget models, consolidated models such as bundled payments and capitation, and incremental models such as pay for performance and shared savings; and the outcome examined, grouped into access, quality, provider finances, efficiency of spending and payer spending. Two findings stand out. The evidence base is extremely concentrated, with the United States, Taiwan, China, the United Kingdom and South Korea accounting for roughly seven out of every ten studies, while eight countries are represented by a single article each. And despite a growing volume of publications, the mechanisms and themes being studied show no clear evolution over the decade, which suggests that some questions relevant to European policymakers remain largely unexamined.
What the deliverable contains:
- A systematic review protocol following PRISMA, with search strategy, eligibility criteria and screening procedure documented in full
- A classification grid for hospital payment mechanisms (activity based, budget, consolidated and incremental) and for the outcomes they are assessed against
- An evidence map of 171 studies across 24 countries, broken down by country, by payment mechanism, by outcome and by year of publication
- Country profiles for the five most researched health systems, identifying the mechanism and the outcome most frequently studied in each
- Annexed reference tables, including an overview of hospital financing in selected European health systems and a full list of the included articles
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