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The health care system, recognized as a labour intensive, user centered service industry, is profoundly influenced by the daily decisions of physicians and other health professionals. Payment systems in health care are therefore considered among the most critical areas of health policy. Sole reliance on a single payment model is generally regarded as ineffective. Hybrid payment arrangements, in which fee for service elements, fixed salary components, and quality or performance based incentives are combined, have been shown to better balance financial incentives, quality of care, service volume, provider satisfaction, and cost effectiveness.
A transition from volume based models toward value based payment has been widely recommended to align financial incentives with quality, effectiveness, and meaningful health outcomes. International experience indicates, however, that implementing value based approaches is associated with significant operational challenges, including the need for robust information technology infrastructure, increased reporting requirements, administrative complexity, and the risk of reduced access for high cost patients or disproportionate focus on incentivized services. Practical and operational barriers, including administrative burdens and potential unintended provider behaviors, must be carefully considered. In some cases, even conceptually well designed payment models fail when operational constraints are underestimated. Accordingly, policymakers should look beyond idealized incentive structures and consider the realities of the implementation environment. Payment reform should be approached not as a fixed endpoint but as an ongoing, iterative process, in which continuous evaluation, gradual adjustment, and systematic monitoring are essential to ensure that reforms remain effective and sustainable.
A transition from volume based models toward value based payment has been widely recommended to align financial incentives with quality, effectiveness, and meaningful health outcomes. International experience indicates, however, that implementing value based approaches is associated with significant operational challenges, including the need for robust information technology infrastructure, increased reporting requirements, administrative complexity, and the risk of reduced access for high cost patients or disproportionate focus on incentivized services. Practical and operational barriers, including administrative burdens and potential unintended provider behaviors, must be carefully considered. In some cases, even conceptually well designed payment models fail when operational constraints are underestimated. Accordingly, policymakers should look beyond idealized incentive structures and consider the realities of the implementation environment. Payment reform should be approached not as a fixed endpoint but as an ongoing, iterative process, in which continuous evaluation, gradual adjustment, and systematic monitoring are essential to ensure that reforms remain effective and sustainable.
Type of Study: Letter to Editor |
Subject:
Special
Received: 2025/12/3 | Revised: 2025/12/30 | Accepted: 2025/12/28
Received: 2025/12/3 | Revised: 2025/12/30 | Accepted: 2025/12/28
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