At the Becker's Hospital Review Annual Meeting in Chicago on May 10, James Slaggert, vice president for integrated health networks at Englewood, Colo.-based Catholic Health Initiatives and David A. DiLoreto, system senior vice president and CMO at Chicago-based Presence Health, discussed how their respective organizations are dealing with the issue of physician compensation in the increasingly value-based world of healthcare.
Mary J. Witt, senior vice president of The Camden Group, who was moderating the discussion, opened the session by talking about the current shift in physician compensation from the pay-for-procedure model to pay-for-value model. Physician compensation models that work in today's world need to foster physician recruitment and retention as well as be focused on patient satisfaction.
"Physician compensation has to be aligned with the revenue stream," said Mr. Slaggert. Compensation methodologies should be consistent and also recognize high quality care, he added. For example, incentive programs for physicians should also be built around patient satisfaction. Leaders at Catholic Health Initiatives are reviewing plans that include potentially transitioning to a value-based physician compensation model linked more directly to productivity and quality, with the percentage of compensation based on quality expected to increase based on individual market demands under the value-based model.
For Presence Health, the most important step towards developing a physician compensation model that worked was first implementing standard operating processes, said Mr. DiLoreto. Presence Health was formed in 2011 through the merger of Provena Health and Resurrection Health Care. To develop a consistent incentive structure, Presence laid out general principles of the compensation plan, which included sustainability, incentivizing transformational change and regulatory compliance, he said.
Mr. Slaggert also noted that while implementing changes to physician compensation is communication — make sure the physicians know that changes are being made.
Mary J. Witt, senior vice president of The Camden Group, who was moderating the discussion, opened the session by talking about the current shift in physician compensation from the pay-for-procedure model to pay-for-value model. Physician compensation models that work in today's world need to foster physician recruitment and retention as well as be focused on patient satisfaction.
"Physician compensation has to be aligned with the revenue stream," said Mr. Slaggert. Compensation methodologies should be consistent and also recognize high quality care, he added. For example, incentive programs for physicians should also be built around patient satisfaction. Leaders at Catholic Health Initiatives are reviewing plans that include potentially transitioning to a value-based physician compensation model linked more directly to productivity and quality, with the percentage of compensation based on quality expected to increase based on individual market demands under the value-based model.
For Presence Health, the most important step towards developing a physician compensation model that worked was first implementing standard operating processes, said Mr. DiLoreto. Presence Health was formed in 2011 through the merger of Provena Health and Resurrection Health Care. To develop a consistent incentive structure, Presence laid out general principles of the compensation plan, which included sustainability, incentivizing transformational change and regulatory compliance, he said.
Mr. Slaggert also noted that while implementing changes to physician compensation is communication — make sure the physicians know that changes are being made.