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This literature review is part of a larger work program being managed jointly by the Australian Commission on Safety and Quality in Health Care (the Commission) and the Independent Hospital Pricing Authority (IHPA). The purpose of this literature review is to review the evidence on existing mechanisms in operation which aim to integrate quality and safety into the pricing or funding arrangements for health care. This literature review will also inform a consultation paper that will explore the options the IHPA and the Commission may recommend to its boards for including quality and safety in its future iterations of the Pricing Framework for Australian Public Hospital Services. The focus of both this literature review and the subsequent consultation paper is on quality and safety in relation to pricing and not on quality and safety per se.