Shift in Payment Models Alters Physician Compensation

Jacqueline Fellows, April 3, 2014

As physician reimbursement shifts from a fee-for-service model to a value-based structure, expect to see changes in how compensation plans are drafted.

Quality and patient satisfaction benchmarks are not only affecting physician reimbursement levels, but they are also a growing component of physician compensation formulas, multiple and independent studies show.

Hospitals and health systems have already been focused on HCAHPS scores, which attempt to measure patient satisfaction, though there is plenty of conversation about whether the survey is an accurate measure of how a patient is treated during a hospital stay. But there is a growing body of research that indicates physician and healthcare executive compensation is or will be tied to patient satisfaction, too.

Slideshow: Healthcare Leaders on Executive Compensation

A February 2014 study from Sullivan, Cotter and Associates (SullivanCotter), 2013 Physician Compensation and Productivity Survey Report, shows an increase in hospitals and healthcare organizations tying portions of compensation to metrics such as quality and patient satisfaction.

As a percentage of the total compensation package, the average amount that was tied to a quality metric was 5%. The dollar amount varied among primary care physicians and specialists, with specialists receiving more than PCPs, though overall, the report showed a higher overall increase in cash compensation for PCPs.

Jacqueline Fellows

Jacqueline Fellows is a contributing writer at HealthLeaders Media.


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