Pay for Performance Nursing Program

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Program Elements

Pay for performance system in nursing implies remuneration provided in response to outstanding care quality. Nursing leaders are often overwhelmed with various tasks and may encounter difficulties with selecting the proper payment method to ensure the most appropriate care services, patient outcomes, and nurse satisfaction. The given case focuses on the nursing-sensitive indicator of medication errors that often occur due to the incompetence of the care team, poor staffing, and other reasons. In this regard, the pay for performance program seems to be the best decision that is likely to eliminate the stated problem and promote higher job satisfaction in nurses.

At the unit level, the proposed system will target the increased individual and group performance as well as the accomplishment of short- and long-term goals. There will be the control points, the achievement of which will present a one-time cash bonus. In particular, both individual and group target goals are to be identified and explained to nurses so that all of them would have the opportunity to receive better remuneration. For example, upon accomplishing the goal of reducing patient falls in the unit by two percent within three months, nurses would have up to 20 percent of the increase to the base pay. In general, one may suggest that approximately 30 percent of remuneration should depend on one’s and the group’s performance. The mentioned estimate seems to promote the stimulation to work better while ensuring that it is sufficient to meet all the lining needs in an appropriate manner.

Since the pivotal goal of the proposed program is the reduction of medication errors at the unit level, the system of remuneration should be focused on rewarding specific behaviors such as administration of correct medication, adequate knowledge of patients and their needs, proper communication, and emotional engagement. The accuracy in naming, packaging, and labeling should also be rewarded as this factor is one of the key reasons for errors. The maintenance of the environment, including lighting, ventilation, and temperature as well as the monitoring of patients’ vital signs such as breathing, coordination, fever, et cetera should be considered important.

Several measures will be used to control the specified pay-for-performance system, including the process, nurse and patient experience, and structure measures. The organization of the program described in the previous paragraph may be adjusted based on these indicators since various aspects of care tend to change constantly. For example, long-term ineffectiveness of such payment, low patient satisfaction, new policies and guidelines, and many other issues should be taken into account while designing the pay system (World Health Organization, 2016). People are the main resource and indicator of proper care and medication error prevention; therefore, their perceptions of communication, relationship building, responsiveness, and respect should be measured before and during the program’s implementation. In turn, the process measure should be used to reveal how nurses promote positive patient outcomes as well as determine any medication errors to be enhanced. It may be important for patients who have cardiovascular problems to quit smoking or administer aspirin. If nurses provide counseling to these concerns, then their performance may be regarded as relevant and deserving higher pay.

Technology is one more vital aspect of the pay-for-performance program that is closely related to the structure measure. Related to the equipment and facilities available to nurses, it offers innovative solutions to diagnose, evaluate, monitor, and educate patients. The use of health information technology should be incentivized through remuneration as a means to adopt evidence-based strategies, applications, and telehealth initiatives. Special bonuses should be introduced to those nurses who proved to be the most successful in using technology to improve patient outcomes and avoid medication errors. More to the point, technology should be utilized in order to control the program’s implementation at the unit level. In particular, it should assist in controlling medication administration via automated information systems and continuous reviews (World Health Organization, 2016). The use of the computerized provider order entry (CPOE) may be significant in reducing confusion and inattentiveness in medication selection, thus affecting overall care quality positively.

The program design also requires discussing the concept of risk adjustment. Even though patients are not allocated to nurses randomly, some of them may select only compliant patients, while non-compliant and seriously ill patients will be left to others (Eijkenaar, 2013). Risk adjustment should prevent such a situation. The process, people, and structure measures should be taken into account in the allocation of patients. This means that age, demographic status, diseases, and so on will reduce the impact of factors that cannot be controlled by nurses in their performance. As a result, fair, equal, and transparent conditions will be created specifically to meet the requirements of the pay-for-performance program.

Benefits and Value

The presented pay-for-performance system is likely to provide several benefits and value to the organization (in this case, unit), nurses, and patients. For the unit, the main benefit is associated with reduced care costs and more focused medication administration. The fact that many patients are likely to sue health care organizations for such errors is also critical, and the situation may be improved through this program (Eijkenaar, Emmert, Scheppach, & Schöffski, 2013). In addition, paying for performance contributes to making the organization more transparent, productive, and comprehensively based on permanent monitoring along with better staff retaining (see Table 1 for details).

As for nurses, they will have an opportunity to receive unlimited compensation, flexibility in care methods, and more elaborated mediation administration guidelines as well as technical assistance. The latter is especially important in the context of global healthcare innovation and evidence-based interventions. Positive patient outcomes are likely to increase nurses’ job satisfaction and motivate them to work better in a long-term period (Eijkenaar et al., 2013). In addition, such a system will stimulate professional development since nurses will be interested in advancing their knowledge and skills to provide high-quality care. For patients, reduced care costs and better health outcomes compose the value of the program, while communication with nurses and care quality will be intangible benefits. Thus, the anticipated advantages seem to be sufficient to justify the payment for the performance program’s implementation since all the stakeholders would have significant benefits.

Table 1. Tangible and intangible benefits and value of the proposed pay for performance system with regard to medication errors.

Tangible Intangible
Organization Reduced care costs;
Fewer complaints and legal action against the unit;
Ease of medication administration.
Retaining talents;
The ongoing evaluation of the problem.
Staff Unlimited compensation;
Flexibility in care methods;
Ease of medication administration.
Increased job satisfaction;
Professional development.
Patients Reduced costs on health care needs;
Better health outcomes.
Improved care quality;
Closer communication.


Eijkenaar, F. (2013). Key issues in the design of pay for performance programs. The European Journal of Health Economics, 14(1), 117-131.

Eijkenaar, F., Emmert, M., Scheppach, M., & Schöffski, O. (2013). Effects of pay for performance in health care: A systematic review of systematic reviews. Health Policy, 110(2-3), 115-130.

World Health Organization. (2016). Medication errors. Web.

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NursingBird. "Pay for Performance Nursing Program." December 14, 2021.