Evaluating Payment Mechanisms: How Can We Measure Unnecessary Care?

There has been substantial concern that linking hospital or physician remuneration to the amount of care provided will encourage excessive provision of health care. Studies that seek to explore this relationship require methods to measure unnecessary care. This paper presents and discusses a method used to assess the magnitude of unnecessary care in the context of an evaluation of the impact of paying bonuses to physicians employed in public hospitals in Shandong Province, China.