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Physicians' Performance-based Incentive Plans Increasing

By John Commins  
   September 17, 2010

Incentive bonuses typically supplement base salaries, which are holding flat in hospital-based organizations, with 2.8% increases in 2009-2010, and 2.9% planned increases for 2010-2011.  Group-based physician practices offer higher salary increases (4.8% granted in 2009-2010), but the planned base salary increases for 2010-2011 dropped to 3.3%.

Salary structures and salary planning for physicians remain flexible in 2010, respondents show.  Half of hospitals and IHS', and 54% of group-based physician practices, say that their process is independent, meaning that they have a philosophy and structure, but that positions, specialties, departments and specific doctors are reviewed individually for their salary potential and subsequent increases. 

The 2010 survey participants included integrated health systems, hospitals and group based physician practices, and covers 128 physician specialties, including 40 pediatric specialties, 16 non-physician provider positions, and 13 medical directors.

The Hay Group survey findings are consistent with a study by the Medical Group Management Association and the Society of Hospital Medicine last week which showed that base salary impacts both productivity and overall compensation for hospitalists.
According to the study, State of Hospital Medicine: 2010 Report Based on 2009 Data, hospitalists who receive a lower proportion of total compensation paid as base salary tend to be high producers who are incentivized to earn more.

The report—which contains information on 443 hospital medicine groups and 4,211 hospitalists—found that hospitalists who received 50% or less of their compensation as fixed base salary reported the highest median work relative value units (wRVUs) at 5,407. Hospitalists who received 51% to 70% of their compensation as base salary performed 4,591 wRVUs, compared to 3,859 wRVUs for hospitalists who received 71% to 90% of their compensation as base salary. Hospitalists who received 91% to 100% of their compensation as base salary reported 3,571 wRVUs.

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

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