HopefulCircle

A program to pay hospitals bonuses for hitting key performance measures, or dock them if they miss, failed to improve the health outcomes of patients, according to a large, long-term study.

The study could lead to a re-examination of financial incentives in healthcare, as policymakers seek ways to reward results rather than paying doctors and other providers for each service they provide, such as a diagnostic test.

Such an incentive program for hospitals is a key provision of the U.S. healthcare overhaul law that is being challenged this week before the Supreme Court.

By Rachael Rettner

When Lindsey Elsaesser was 20 weeks pregnant, an ultrasound revealed her unborn baby girl had extremely fragile bones. Doctors suspected the child had a bone disorder, and would not live long after birth.

"They thought she would die from respiratory failure because her bones were so weak," Elsaesser said.

When Elsaesser's daughter, Evie, was born in September 2009, doctors were cautiously optimistic about her condition. While Evie's bones were transparent in X-rays, they sufficiently supported her lungs.