INFOGRAPHIC | Benchmarking Resources for the Medical Group Workforce
Gain access to critical medical group benchmarking data for the entire health care workforce - including executives, physicians, advanced practice providers and other health care staff
This year more than ever, medical groups require access to critical data-driven insights as they look to address the impact of COVID-19 on workforce compensation and productivity, prepare for the 2021 Physician Fee Schedule changes, and balance the need for competitive total reward programs against pressure on operating margins.
Learn more about SullivanCotter’s growing suite of medical group benchmarking resources for all your workforce needs – including annual compensation data and incentive award opportunities for executives, detailed productivity reporting for physicians and advanced practice providers, and market data by organization size, region, state and more for other health care staff positions.
Our suite of 2021 health care compensation surveys are now open for participation!
View highlights from the 2020 results to learn more about SullivanCotter's proprietary benchmarking data and resources available to medical groups.
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INFOGRAPHIC | 2020 Physician On-Call and Telemedicine Compensation Survey
One-of-a-kind survey providing rare insight into physician call-pay and telemedicine practices
As clinical care settings and practices continue to change in a rapidly evolving health care environment, many organizations are expanding or evaluating their physician on-call and telemedicine programs.
Designing effective arrangements to support this demand is critical, and starts with gaining access to the right data.
With nearly 300 participating organizations providing information on approximately 3,100 individual call contracts, this survey provides hospitals and health systems with the data they need to help address complex call pay issues, understand emerging trends in telemedicine, negotiate contracts and evaluate physician fair market value.
The 2020 survey report is now available for purchase! View highlights from the results to learn more.
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ARTICLE | 10 Best Practices for the Board's Human Capital Committee
Featured in McDermott Will & Emery's new e-book from its Governing Health series
SullivanCotter's Kathy Hastings, Executive Workforce Practice Leader, and Tim Cotter, Managing Director, have contributed to a new e-book from McDermott Will & Emery entitled Key Agenda Items for Board Committees: A Briefing for Governance and Executive Leadership.
Their chapter focuses on the board human capital committee and the key role it plays in guiding human resources strategies as health care organizations face today's challenges. Human capital is critical to organizational strategy, and the committee should test whether the components of the human capital strategy – namely people, process and technology practices – can sustain the organization.
INFOGRAPHIC | 2020 Endowment and Foundation Investment Staff Compensation Survey
Featuring data from more than 50 not-for-profit organizations nationwide
This survey offers a comprehensive look into compensation and pay practices for investment staff positions among college and university endowments, private foundations, health care and other not-for-profit organizations. It also includes detailed insight into the chief investment officer position.
View highlights from the 2020 results, including average year-over-year increase in base salary for key investment positions, incentive compensation as a percentage of salary for the chief investment officer position, and investment office size by asset category.
Don't miss your chance to participate - the 2021 survey is now open! The final deadline to submit is February 26, 2021.
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Understanding Co-Management Arrangements
Key drivers, compensation structures and payouts, and performance metrics and target setting
As health care continues to shift its focus from volume to value, hospitals are implementing strategies to help strengthen hospital-physician alignment. Co-management arrangements are contractual agreements between hospitals and physicians that establish shared responsibility for particular service lines. These agreements are commonly structured with an even split between both base and incentive compensation components. Base compensation is tied to the number of management service hours required to fulfill baseline duties, while incentive compensation is linked to strategic performance measures.
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PRESS RELEASE | SullivanCotter Integrates Health Care Contract Management Solution into PPMT™
Partnering with Ntracts to deliver full-scale contract lifecycle management capabilities
November 30, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of total rewards programs, workforce solutions, and technology and data products for the health care industry and not-for-profit sector, has partnered with Ntracts, a premier health care contract management solution, to incorporate full-scale contract lifecycle management as part of its comprehensive Provider Performance Management Technology™ (PPMT) platform. PPMT™ is an industry-first, cloud-based solution that enables engagement and alignment of the clinical workforce through the automation of performance-based compensation administration, analytical and reporting capabilities. Ntracts allows organizations to mitigate contract compliance risk and streamline the contracting process across the entire enterprise.
Designed to address a spectrum of physician, leadership and other key administrative needs, PPMT™ delivers centralized and actionable data tailored to the unique needs of each stakeholder. It combines years of health care compensation insight and expertise with an intuitive, automated technology platform, and serves as a single source of truth that helps empower physicians to drive desired outcomes and enhance organizational performance.
Ensuring that physician employment agreements align with system-wide compensation terms and payments remains a challenge for health care organizations nationwide. With the addition of Ntracts, PPMT™ will include a cutting-edge contract lifecycle management component that will provide hospitals and health systems with an accurate and comprehensive view of clinical employment contracts across the organization in real-time. By effectively integrating the compensation, performance and contract lifecycle management process into one centralized platform, PPMT™ will help to drive results through greater alignment, transparency and insight.
“Health care continues to evolve at a rapid pace, and there are number of complex moving parts to navigate as it relates to physician compensation and performance. By adding critical contract management capabilities to help health care organizations reduce risk, maintain compliance with changing regulatory requirements, and improve operational efficiency, PPMT™ will be a full-scale solution designed to support the transition from volume to value-based care,” said David Schwietz, Chief Information Officer, SullivanCotter.
David Paschall, Chief Executive Officer of Ntracts, adds, “SullivanCotter shares our commitment to quality and we are proud to combine our industry-leading contract lifecycle management solution with SullivanCotter’s expertise in physician compensation and performance. Together we can offer an unmatched, end-to-end technology solution to support health care organizations as they work to drive change and deliver long-term, sustainable results in this quickly evolving environment.”
For more information on Provider Performance Management Technology™, visit www.sullivancotter.com/PPMT or contact us at 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights, expertise, data and technology to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.
About Ntracts
Ntracts, Inc. offers a software-as-a-service application that enables users to originate, search for and report on contracts. The application also accelerates the contract review and approval process by automatically notifying responsible parties of contract requests, approaching expiration dates and other critical performance milestones, saving clients both time and money. Ntracts, Inc. is based in Indianapolis, Indiana, and was founded by Hall, Render, Killian, Heath & Lyman, the nation's leading health care law firm.
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INFOGRAPHIC | 2020 Health Care Staff Compensation Survey
Key considerations for the health care employee workforce during COVID-19 and through 2021 and beyond
Employee compensation programs are shifting to address changing market dynamics and mitigate the financial implications of COVID-19. Considering the current impact of the pandemic, the 2020 survey benchmarks represent the best data reference point for use in the near future.
Organizations have been impacted by the pandemic to varying degrees, so it is important that each organization analyzes their unique circumstances when utilizing this market data. Applying a holistic approach will allow each organization to consider future changes that are the best fit for their situation rather than an industry best practice.
SullivanCotter’s 2020 Health Care Staff Compensation Survey contains data from nearly 1,200 organizations on approximately 1,194,900 individual employees.
The 2021 survey is now open for participation!
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PRESS RELEASE | Annual results from SullivanCotter's Physician Compensation and Productivity Survey
Physician Compensation Programs Shifting to Address Changing Market Dynamics and Mitigate COVID-19 Financial Implications
November 11, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of total rewards programs, workforce solutions, and technology and data products for the health care industry and not-for-profit sector, recently released results from the 2020 Physician Compensation and Productivity Survey – which represents data from more than 800 organizations on nearly 244,000 individual physicians and advanced practice providers. The results reflect calendar year 2019 and, as the last set of benchmark data available prior to the onset of COVID-19, this year’s survey will serve as an important resource for organizations needing pre-pandemic compensation reference points for this critical workforce.
“Although the pandemic has created a great deal of uncertainty – with many organizations making near-term modifications to their physician compensation programs as a result – we’re seeing a slow and steady adjustment to the ‘new normal’ as patient volumes have returned to approximately 90% of pre-COVID-19 levels. In some ways, the fallout from COVID-19 has simply accelerated the forces that were driving physician compensation changes prior to the pandemic, and the 2020 survey data will be very important in helping to determine how organizations are responding to these challenges,” said Tim Stamper, Senior Consultant, SullivanCotter.
Physician Total Cash Compensation (TCC)
While TCC has grown, on average, 2.5% annually since 2012, COVID-19-related reductions in surgical and non-emergent care have impacted the financial condition of many health care organizations nationwide – causing them to implement or consider a number of compensation and benefits-related modifications to help offset significant losses in revenue. According to SullivanCotter’s COVID-19 Physician and Advanced Practice Provider Compensation Practices Survey series, nearly 30% of participants had implemented or were considering pay reductions for front line physicians and nearly 40% of participants were doing the same for non-front line physicians as of May 2020. Median pay cuts were 11% and 15% for front line and non-front line physicians respectively. Other organizations made cuts in physician benefits in response to COVID-19. The most common benefit program changes in 2020 included eliminating or reducing retirement plan contributions, adjustments to PTO policies, and eliminating or reducing CME allowances. The majority of these actions were intended to be temporary and, as patient volumes continue to increase and organizations start to recover financially, many are returning to historical pay and benefits practices.
Due to the financial impact of COVID-19, physician incentive programs have also come under scrutiny in 2020. Among respondents surveyed in May, 16% of organizations reported eliminating or reducing non-productivity incentive compensation in 2020 while an additional 38% were considering this action. Many organizations pay out these incentives at year-end, making these programs an obvious target for cost-reduction.
Physician Productivity
The 2020 Physician Compensation and Productivity Survey results continue to show a trend of flat or even declining median work RVU (wRVU) productivity across all major specialty categories. Since TCC showed modest increases in the 2020 survey, TCC per wRVU ratios have also increased. While we have anticipated growth in value-based incentives, wRVUs and productivity-based incentives still determine the majority of incentive or variable compensation as a percentage of TCC. Approximately 70% of organizations utilize wRVUs to determine compensation for primary care and specialist physicians, with wRVU productivity accounting for about 18% of TCC in plans with a base salary component and over 90% of TCC in plans without a base salary component. Less than half (44%) of organizations surveyed include a wRVU component for hospital-based physicians, who are instead paid primarily on base salary and shift-based models.
As organizations focus their attention on maintaining patient access and minimizing the financial losses created by COVID-19, the emphasis on individual wRVU productivity will remain prominent. While the pandemic itself has had a sizable impact on patient volumes and physician productivity, the Centers for Medicare and Medicaid Services’ (CMS) proposed changes to the Evaluation & Management wRVU values loom large as organizations look ahead to 2021. These adjustments include an increase in wRVUs for most office-visit E&M codes due to added responsibilities physicians have absorbed over the last five years. As a result of the overall projected increased in wRVUs, a 10.6% reduction in the conversion factor was required in order to maintain budget neutrality. The proposed increase in wRVU values ranges from 28%-46% for established office visits, which will have a significant impact on compensation plans that use wRVUs as a determinant of compensation.
Considerations for 2020 and Beyond
Although COVID-19 has sharpened industry focus on supporting financial sustainability, other market dynamics and the timing of anticipated financial recovery are also influencing the way hospitals and health systems are approaching physician compensation in both the short and long-term.
“Considering the implications of COVID-19 in 2020 and the impending impact of wRVU changes in 2021, the 2020 survey benchmark data represents the best data reference point for use in the near future. With appropriate context, it can serve as a foundation for understanding specialty market positioning leading into COVID-19, identifying recruitment and retention risks, and pinpointing areas of focus for targeted compensation adjustments as your organization moves forward with 2021 planning,” said Dave Hesselink, Principal, SullivanCotter.
There are a number of important physician compensation considerations for organizations to assess as they continue to navigate the new normal:
- Be mindful of how to appropriately use 2020 survey data. Understand the timing of the data and consider what you are trying to assess before using it. It can be helpful in benchmarking the competitiveness of compensation program elements and incentive opportunities.
- Develop an approach to physician compensation now in response to CMS’ proposed wRVU changes. Organizations should be proactive in assessing how these changes will impact payer reimbursement and physician compensation programs.
- With continued uncertainty regarding the impact of the pandemic in FY2021 and beyond, be prepared for new pandemic-related challenges to patient revenues and physician compensation. Organizations would be well-advised to have a plan developed in advance of any new restrictions on elective and non-emergent care to mitigate additional financial losses.
For more information on SullivanCotter’s surveys or the upcoming Evaluation and Management wRVU value changes, please visit our website at www.sullivancotter.com, email us or contact us by phone at 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights, expertise, data and technology products to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.
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INFOGRAPHIC | 2020 Physician Compensation and Productivity Survey
Utilizing the 2020 survey data to assess the competitiveness of physician compensation programs and incentive opportunities
Physician compensation programs are shifting to address changing market dynamics and mitigate the financial implications of COVID-19. Considering the current impact of the pandemic and the impending wRVU changes in
2021, the 2020 survey represents the best data reference point for use in the near future.
With appropriate context, it can serve as a foundation for understanding specialty market positioning leading into COVID-19, identifying recruitment and retention risks, and pinpointing areas of focus for targeted compensation adjustments as you move forward with 2021 planning.
Learn more from SullivanCotter’s 2020 Physician Compensation and Productivity Survey - which contains data from more than 800 organizations on approximately 244,000 individual physicians and advanced practice providers (APPs).
The 2021 survey is now open for participation!
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PRESS RELEASE | Results from SullivanCotter's Annual Health Care Executive Compensation Survey
Offering insight into pandemic-related pay actions and considerations for 2020 and beyond as health care organizations plan for what lies ahead
November 5, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of total rewards programs, workforce solutions, and technology and data products for the health care industry and not-for-profit sector, recently released results from its 2020 Manager and Executive Compensation in Hospitals and Health Systems Survey — which is now in its 28th year. This year’s results include information from more than 2,300 organizations. More importantly, the survey contains the last set of benchmark data compiled prior to the onset of COVID-19 and provides important pre-pandemic reference points for assessing executive compensation programs.
“While pay actions are being impacted by the pandemic, the foundational structure of executive compensation programs has generally remained unchanged. The 2020 survey data can be used to assess the competitiveness of base salaries, the level of incentive opportunities and other program design considerations. In light of the impact of the pandemic on business operations, now is an appropriate time to evaluate the broader implications of COVID-19 on your talent strategy, compensation philosophy and program design to ensure they reflect your organization’s new priorities,” said Tom Pavlik, Managing Principal, SullivanCotter.
Executive Base Salaries in 2020
In recent years, executive salaries were trending upward due to the focus on recruitment and retention of key leadership talent and an increasingly complex health care market. When comparing data reported by organizations that participated in SullivanCotter’s survey in both 2019 and 2020, median base salaries going into 2020 increased at a rate of 3.4% to 5.6% for the most senior executives of independent health systems (Vice Presidents, Senior Vice Presidents, CFOs, COOs and CEOs) as opposed to 0.8% to 4.1% for those executive positions at system-owned hospitals.
However, due to the financial impact of COVID-19, many organizations have implemented temporary executive base salary reductions. According to SullivanCotter’s COVID-19 Executive and Employee Compensation Practices Survey series, which was conducted between April 2020 and August 2020 to provide insight into the current practices of more than 100 large health systems, only 14% of organizations were considering or had implemented executive base salary reductions as of April. By May, this number had risen to 31%. Through August, implemented salary reductions reached 45%. However, of this 45%, nearly half had already reinstated the pre-pandemic salaries with the remainder expected to do so by the end of the year.
Executive Base Salary Increase Budgets
An analysis of the survey data indicates that, prior to COVID-19, median salary increase budgets for health care executives were expected to remain consistent with recent years at 2.7% for independent health system executives and 3.0% for system-owned hospital executives. The pandemic has impacted the financial condition of many organizations and is moderating salary increase plans for FY2021.
According to SullivanCotter’s proprietary COVID-19 research, about 40% of organizations had determined their FY2021 executive salary increase budgets by mid-August. The preliminary median executive salary increase budget is 2.5%, with 15% planning to freeze executive salaries. The other 60% of organizations had not yet determined their salary increase budget, and 20%-25% are delaying the timing of these increases. These figures may change over time as financial performance will impact the ability to fully fund planned budgets, and it is anticipated that more organizations may consider executive salary freezes for FY2021.
Executive Annual Incentive Plans
Executive annual incentive plans (AIPs) are still the norm as organizations are increasingly focused on system-wide alignment and pay-for-performance. Prior to COVID-19, 89% of independent health systems and 67% of system-owned hospitals utilized AIPs with award opportunities varying by health system size based on net revenue.
According to SullivanCotter’s research, however, COVID-19 has had a significant impact on executive incentive plans for FY2020. As of mid-August, more than half of the participating organizations had implemented or were still considering changes to FY2020 plans. While one-third did not yet know how they will handle their FY2020 annual incentive payouts, approximately 20% are eliminating or considering eliminating payouts, nearly 30% expect to pay below target, and only about 20% expect to pay at target or above.
Considerations for 2020 and Beyond
As hospitals and health systems plan for what lies ahead and look to support financial sustainability and mitigate risk, organizations should consider both market practices and their individual financial circumstances when determining their executive compensation and workforce-related actions moving forward.
“SullivanCotter’s 2020 survey reflects the most recent normative year prior to COVID-19. Due to the current pandemic and the extremely dynamic environment, the survey data should be used thoughtfully, with appropriate context, and with sound business judgement as you are planning and considering your pay decisions for FY2020 and beyond,” said Bruce Greenblatt, Managing Principal, SullivanCotter.
There are a number of important executive compensation considerations for organizations to consider as they move forward:
- Be mindful of how to appropriately use 2020 survey data. Understand the timing of the data and consider what you are trying to assess before using them. The data can be helpful in benchmarking the competitiveness of compensation program elements and award opportunities.
- Rely on sound business judgement and discretion when evaluating base salary actions and incentives for FY2020.
- Plan to revisit incentive performance goals for FY2021 to ensure they are tailored to the current environment.
- Assess the broader impact of COVID-19 on executive talent strategy and review the compensation philosophy and program design.
- With continued uncertainty in FY2021 and beyond, remain mindful of the environment and be flexible.
For more information on SullivanCotter’s surveys, please visit our website at www.sullivancotter.com, email us or contact us by phone at 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights, expertise, data and technology products to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.
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INFOGRAPHIC | 2020 Manager and Executive Compensation in Hospitals and Health Systems
Considerations for using the 2020 survey data in light of COVID-19
As the last set of benchmark data available prior to the onset of COVID-19, SullivanCotter shares results from its 2020 Manager and Executive Compensation in Hospitals and Health Systems Survey. This analysis also includes insight into pandemic-related pay actions, important considerations for 2020 and beyond as organizations plan for what lies ahead, and using this year's benchmark data to help navigate future executive compensation decisions in light of COVID-19 and other market dynamics.
Now in its 28th year, this survey is the largest and most comprehensive of its kind for hospitals and health systems nationwide. Information was collected from over 2,200 organizations comprising 460 health systems and 1,800 hospitals and includes data for more than 42,000 individual managers and executives.
The 2021 survey is now open for participation!
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PRESS RELEASE | SullivanCotter Releases Enhanced Patient Panel Management Capabilities for PPMT™
Utilize SullivanCotter's industry-first physician compensation software to automate the assignment of patients to clinician panels through sophisticated organization-defined rules
October 28, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of total rewards programs, workforce solutions, and technology and data products for the health care industry and not-for-profit sector, launches expanded patient panel management functionality in the latest update of its comprehensive Provider Performance Management Technology™ (PPMT). PPMT™ is an industry-first, cloud-based physician compensation software that enables provider engagement through transparent performance-based compensation administration, reporting and analytical capabilities.
As the focus on optimizing team-based care to achieve better patient outcomes intensifies, health care organizations require more effective strategies and resources for facilitating patient panel management. PPMT™ enables organizations to automate the assignment of patients to clinician panels through sophisticated client-defined rules. It then calculates a risk-adjusted panel size and applies compensation calculations for a group or individual based on an organization’s requirements – providing the flexibility to change patient attribution and/or panel compensation assignments as clinical teams evolve. PPMT™ allows for greater transparency into panel composition and serves as a single, centralized source of truth for clinician compensation.
“Properly attributing patients to the correct clinician’s panel can require hours of administrative time each month. Combined with detailed analytics and powerful auditing and adjustment tools, the new panel management functionality streamlines this process to ensure more accurate attribution and support effective panel management programs,” said Shelly Slowiak, Director, Product Support, Provider Performance Management Technology™, SullivanCotter.
Designed to address a spectrum of physician, leadership and other key stakeholder needs, PPMT™ combines years of health care compensation insight and expertise with an intuitive, automated technology platform to help drive clinician performance and support the transition from volume- to value-based care. It incorporates SullivanCotter’s industry-leading benchmarking data into three integrated modules, including Provider Performance Management, Provider Productivity Insights and Compensation Management Analytics.
“We’re working hard to understand our clients’ changing needs and priorities and, as a result, will continue to refine our product roadmap and deliver the functionality they require to help navigate such a dynamic marketplace. This innovative new functionality will serve to strengthen our existing physician compensation software and panel management capabilities, and is a welcome addition to PPMT™ as we strive to develop one of the industry’s most comprehensive, end-to-end technology products for managing clinical compensation and performance,” said David Schwietz, Chief Information Officer, SullivanCotter.
For more information on Provider Performance Management Technology™, visit www.sullivancotter.com/PPMT or contact us at 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights, expertise, data and technology to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.
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INFOGRAPHIC | Considerations for Addressing the 2021 E&M Work RVU Changes
Considerations for Addressing CMS' final changes to the 2021 E&M Work RVU Values
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ARTICLE | 2021 Evaluation and Management CPT Codes: Understanding the Impact on Physician Compensation
ARTICLE | Navigating Change: Implications of the 2021 Physician Fee Schedule
SullivanCotter's CPT Advisory Services and Technology Solutions
Following its annual review of the American Medical Association’s Relative Value System Update Committee’s recommendations, the Centers for Medicare and Medicaid Services (CMS) finalized proposed changes to the 2021 Physician Fee Schedule and has significantly overhauled the Evaluation and Management (E&M) code documentation requirements, time-effort recognition, and wRVU values for new and established patient office visits. These changes were effective as of January 1, 2021.
As organizations look to understand the impact of these changes on reported physician productivity levels, it is also important to assess the effect it will have on physician compensation arrangements, fair market value and commercial reasonableness considerations, financial sustainability and national survey benchmarks.
Contact us or visit our CPT Solutions page learn more about assessing the impact of the E&M code changes within your organization.
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PRESS RELEASE |
Hospital Sisters Health System Implements PPMT™
Hospital Sisters Health System Selects Innovative Technology Product to Automate and Enhance Physician Compensation and Performance Management Capabilities
October 13, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of rewards programs and workforce solutions for the health care industry and not-for-profit sector, has partnered with HSHS Medical Group and Prairie Cardiovascular, two Hospital Sisters Health System ministries, to implement its comprehensive Provider Performance Management Technology™ (PPMT).
Hospital Sisters Health System is a large, multi-institutional health system committed to delivering high-quality, patient-centered care to communities throughout Illinois and Wisconsin. By leveraging PPMT™, an industry-first, cloud-based product that enables physician and APP engagement through transparent performance-based compensation administration and analytical capabilities, the organization is looking to automate and align the management of clinician pay and performance across its medical group.
Driven by the need to provide a growing network of physicians with more accurate compensation and productivity data, HSHS Medical Group and Prairie Cardiovascular started the journey with an in-house application designed to enhance a process that was once very manual. Developing the right mix of internal resources and support to expand the application’s capabilities in line with the system’s evolving needs, however, proved difficult.
“We required a more comprehensive system with the ability to flex and scale with us as we add or change value-based incentives, modify compensation plans and analyze the impact of Evaluation and Management CPT code changes. PPMT™ will now enable us to automatically deliver extensive supporting documentation with drill-down capabilities to the patient-level for our clinicians to access any time they want. Providing this visibility and transparency is critical as we navigate an increasingly complex and rapidly changing health care environment,” said Linda Dace, System Vice President of Finance, Hospital Sisters Health System.
PPMT™ incorporates SullivanCotter’s industry-leading benchmarking data into three integrated modules, including Provider Performance Management, Provider Productivity Insights and Compensation Management Analytics. Hospital Sisters Health System selected all three modules to help support their goals - allowing for a more cohesive approach to compensation and performance management.
For more information on Provider Performance Management Technology™, visit www.sullivancotter.com/PPMT or contact us at 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights and expertise to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.
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Optimizing Care Delivery in Response to COVID-19
Supporting system-wide alignment in an evolving health care environment
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Health systems nationwide continue to face a number of unprecedented challenges due to the evolving COVID-19 pandemic. Supporting financial sustainability remains a top priority. As the industry looks ahead and makes plans for financial recovery and operational transformation, optimizing care delivery to improve efficiency, drive workforce performance and increase revenue is a critical step in this process.
Care delivery optimization between systems and their affiliated hospitals, integrated practices, and physician and advanced practice provider (APP) workforces can promote financial sustainability by identifying gaps in care delivery, improving operational efficiency, reducing clinical variation, and expanding capacity for important growth initiatives. To help accomplish this, there are five key areas that health care organizations should focus on as they look to position themselves to deliver the greatest possible value.
SullivanCotter recommends a thoughtful and strategic review of the following areas:
Physician/APP-Hospital Alignment
Aligning operations, goals and results across the organization is key to building a workforce that is unified and supports organizational strategy. To enhance care delivery optimization, organizations should:
- Assess current physician affiliation relationships, including pending and/or potential mergers and acquisitions and consider:
- Updating due diligence assessments in the context of COVID-19 to include financial analysis and review of agreements
- Reviewing key characteristics of existing compensation arrangements and performance requirements to conduct best practice comparisons by affiliation model/relationship and assure incentives are aligned between the models
- Evaluate current and projected physician and APP staffing requirements and care team development to address community need, integrated practice and service line needs
- Review current and potential Service Line Co-Management or HEIP (Hospital Efficiency Improvement Plan) arrangements to ensure the metrics are still aligned with system goals
- Assess physician involvement in the decision-making process, including medical group and service line governance structure
- Consider clinical workforce culture and perceptions related to strategic objectives while also identifying opportunities for improvement
Medical Group Operational and Financial Performance
Evaluating a medical group’s overall performance against a variety of operational and financial metrics will help identify actionable areas for improvement.
- Assess key medical group and/or specialty-level operational and financial performance indicators
- Review and update productivity thresholds and benchmarks, revenue, expenses and overall financial performance, staffing ratios, measured outcomes, patient capacity and clinic throughput
- Evaluate performance indicators shared with physicians and APPs and ensure systems are in place to provide transparent and timely information on performance relative to benchmarks, service line and system strategic goals
- Consider primary care model redesign and develop financial feasibility pro forma based on volume expectations and clinical regulations
- Focus on care delivery models designed to achieve optimal financial performance with a patient-centric focus (e.g., improves satisfaction, APPs practice at top-of-license, yields appropriate return on investment)
- Perform workflow assessment at the service line and practice levels to evaluate patient access and throughput, including the utilization of telehealth and remote services
Specialty and Service Line Care Delivery
Once the medical group’s overall performance has been assessed and specific underperforming specialties have been identified, it is important to do a deep dive into specialty and service line performance. Assessing clinical workforce performance is imperative as organizations look to increase the focus on value-based outcomes associated with quality and cost.
- Evaluate unwarranted care variation and cost-efficiency opportunities
- Develop strategies to reduce length of stay variance, readmission and value-based care penalties
- Perform service line and facility-based workforce planning and staffing efficiency assessments
- Identify appropriate benchmarks related to cost of care against internal and external cohorts
- Review physician referral processes to help project actual and expected volumes
Readiness for Value-Based Care
Successfully navigating the transition from volume to value relies largely on enhancing patient access. Care model designs that do not support this goal will likely result in stagnant market share or loss of patients.
- Conduct a physician needs assessment, demographic map and strategic plan to match service needs within market segments based on expected changes
- Perform analysis of telehealth capacity, financial return on investment and regulatory requirements
- Assess clinic space, including waiting room access and throughput in light of COVID restrictions
APP Utilization
APPs are one of the fastest growing segments of the health care workforce. Integrating APPs as key members of the care delivery team and utilizing them to their full potential can help an organization to achieve a number of important goals – including improved patient access, increased revenue, and enhanced quality and service while also reducing the cost of care.
- Perform a current-state analysis by comparing APP utilization and productivity to market benchmarks based on specialty and role:
- Quantify the financial opportunity available with a fully optimized APP workforce
- Conduct a readiness assessment to determine barriers and cultural considerations related to full APP optimization
- Identify specific specialties or service lines with the most opportunity (financial or non-financial) and readiness for change
- Review and update APP organizational practices:
- Assess governance structures, recruitment and retention policies, and training and development programs
- Align organizational bylaws, policies, practices and operations to federal and state laws, payer policies and procedures, and leading market practices
Conclusion
The process of evaluating these five focus areas will help to highlight and quantify opportunities for improving patient access, enhancing organizational efficiency, increasing revenue and reducing costs as health systems plan for what lies ahead. For each area of focus, SullivanCotter recommends developing an in-depth assessment, utilizing operational and financial expertise and incorporating comparative benchmark data analysis to define potential solutions unique to the requirements of each system to help optimize clinical performance and achieve key organizational goals.
Leveraging data-driven insights and over 25 years of experience, SullivanCotter partners with organizations to develop comprehensive care delivery optimization strategies tailored to the unique needs of each client.
Implementing a Job Architecture
Getting the Most from Your Human Capital Management System
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A Time of Transformation
Due to the evolving COVID-19 pandemic, hospitals and health systems nationwide continue to navigate a number of financial and workforce challenges. As organizations make plans for financial recovery and operational transformation, there is no doubt that the health care industry is in the midst of significant change. At present, there are many views on the form this transformation may take. Recent news articles and interviews with health system executives suggest a myriad of approaches are likely to be taken during such an unprecedented time:
- Reducing and/or reallocating certain resources to optimize the workforce
- Streamlining management structures
- Accelerating mergers and acquisitions
- Restructuring/centralizing administrative and patient care services to facilitate innovation and deployment
- Standardizing processes to more clearly define roles and responsibilities
- Diversifying health systems through continued entry into adjacent enterprises such as health plans and technology solutions
- Reimagining and accelerating the delivery of care in ambulatory settings and virtually
- Broadening skill sets to facilitate flexible deployment and re-deployment of certain workforces in times of change and/or crisis
Although this journey will look different depending on the unique needs and circumstances of individual organizations, change is well underway. Though the health care industry has been evolving for a number of years, COVID-19 has made the need for transformation more urgent and, in some cases, greatly affected the trajectory of the transformation.
Technology and Transformation
To facilitate transformation, many health care organizations are beginning to migrate from on-premise Enterprise Resource Planning (ERP) and Human Capital Management (HCM) systems to cloud-based platforms from organizations such as Workday, SAP, and Oracle/PeopleSoft.1
While the transition has been slow, the need for greater workforce optimization and enhanced processes along with the growing obsolescence of on-premise systems triggered this migration. Organizations making the investment in a cloud-based system report that they are looking to:2
- Enhance critical workforce insights through real-time reporting and analytics to facilitate workforce optimization
- Improve administrative processes and implement best practices to allow functions such as finance, supply chain management and human resources to be more strategic
- Align operations around a single system – eliminating a number of disparate applications
- Streamline transactions as it relates to mergers, acquisitions and organizational restructuring
- Integrate a variety of information sources to enhance data integrity
- Secure best-in-class manager and employee self-service capabilities
- Support compliance and mitigate risk
- Reduce variability of practices across the organization
At a time when hospitals and health systems are looking to restructure, diversify and transform, it may seem counterintuitive to suggest that ERP and HCM systems will be a key part of an organization’s transformation strategy. However, David Chou, a prominent health care technology executive and consultant, indicates that “healthcare provider institutions must begin aggressive ERP initiatives” going into 2021 if they want to remain competitive.3 He notes that many on-premise systems are being sunset as the need to enhance the efficiency of administrative processes is long overdue. Health care organizations have only two choices – carry on with costly and inefficient processes or finally make the investment in ERP and HCM technology to optimize and align operations.
For those who play a critical role in managing the health care workforce, the most important component of an ERP system is its HCM module. An HCM system is essentially a database and group of applications that helps to facilitate the management of an organization’s workforce. This often includes compensation, recruitment, learning and development, performance management and payroll functionality. It can either stand alone or be implemented as part of a broader ERP system.
Implementing a Human Capital Management System
Unfortunately, surveys indicate that nearly half of ERP projects fail to achieve the desired outcomes or run over budget and past deadline.4 While there are a number of reasons for these implementation challenges – the most prominent one is that many organizations are simply not ready or properly prepared.
A successful implementation requires much more than just the technology. Critical to the process is a need for well-defined goals, strong commitment from management and other key stakeholders, depth and breadth of expertise on the project team, open communication and the dedication to instill change.
Also very important, but often overlooked, is the need to have clearly defined processes and structures prior to implementation. Foremost, there is little value in implementing structures and processes that are not fully aligned with an organization’s strategy. Additionally, with the tight timeframes often set by organizations and their deployment partners, there is usually little choice but to do what is known as a “lift and shift”. This refers to organizations utilizing their current processes and simply reimplementing those practices into the new technology platform.
This poses a unique challenge for health systems as few organizations begin the deployment with best practices in place. In fact, many utilize a number of disparate processes, structures and tools to manage human capital. So not only have they failed to implement best practices, they currently have few system-wide practices in place.
A comprehensive review of SullivanCotter’s Workforce Insights360™ database, which contains related information from nearly 40 contributing hospitals and health systems, shows that:
- Approximately 25% of organizations have more than 1,900 job titles and have just 5 employees per job title – this number is even less if you exclude nursing and service line jobs.
- From CEO to first line supervisor, the median number of organizational levels is 8. The median number of management job levels is 15 – which includes almost 2 management job levels per organizational level.
- Moreover, 25% of organizations have 20 or more job levels from CEO to supervisor. This level of granularity explains why many organizations have difficulty differentiating management titles and far exceeds the one-to-one relationship between job titles and organizational levels common in other industries.
- In regards to reporting relationships and the restructuring around functional lines, only about 60% of human resources and finance employees report up through the CHRO or CFO hierarchy. For a quarter of the organizations, this number was less than 50%. This suggests that health care organizations remain largely decentralized when it comes to support functions.
While an HCM system can be implemented without aligning important processes and structures, failure to do so prior to or in conjunction with HCM system deployment often leads to sub-optimal outcomes. Not only is the organization failing to secure the type of transformational change that was likely an important reason for the initial investment in a cloud-based HCM system, but the functionality they are getting as a result is often sub-optimal.
Although highly recommended as an important best practice, it may not be feasible for some organizations implementing an HCM system to have all their processes and structures harmonized and defined at the outset. The implementation of an HCM system is a journey that provides the ability to strengthen and refine current processes and structures or develop new ones.
However, there is one area that all organizations should prioritize – their job architectures.
The Importance of a Job Architecture
Job architecture refers to an organization’s framework for defining and cataloging jobs – the output of which is its library of jobs.
For many HCM systems, the job architecture and database are the hub around which critical functionality is built.
Studies show that 75% of organizations that have implemented a new cloud-based HCM system have also developed a new job architecture before, during or after deployment.5 This not only reinforces how critical a well-defined job architecture is to this process, but also highlights the fact that most organizations do not already have the appropriate structures in place to maximize value from the deployment of a new HCM system.
How an organization defines the job architecture influences how many jobs it has and how the roles are defined. It will affect what type of reporting and analytics are available and how workforce data is accessed by executives, managers and employees. It will also impact how human resources programs are designed or can be deployed. The structure of this database and its content are critical to optimizing the functionality of an HCM system.
The table below reflects the type of information frequently housed in this database and its linkage to important human resources processes:
To optimize the deployment and eventual utilization of the job catalog within a cloud-based HCM system, organizations must consider the following:
1. Cloud-based HCM systems are configurable – not customizable
Hospitals and health systems coming from an on-premise environment are accustomed to doing just about anything they want. When developing new attributes, for instance, they often write elaborate scripts to create custom workarounds. Cloud-based platforms are not intended to work this way, however. They are built upon best practices that the technology provider applies to all users and work best when one understands their parameters and builds their job architecture and job content around those parameters.
2. Manager and employee self-service requires consistency and ease-of-use
Several HCM systems highlight manager and employee self-service as a cornerstone in their value proposition. This creates a challenge for organizations that lack transparency in their job architecture and compensation programs.
If these self-service capabilities are enabled:
- A simple and intuitive organizing principle must be developed so managers and employees can search, query and request reports
- Inconsistencies should be resolved to eliminate any potential confusion and enhance the usability of the information
- Content must be widely available and regularly maintained to allow managers and employees to make appropriate decisions within a self-service environment
Organizations implementing a cloud-based HCM system with manager and employee self-service capabilities would be wise to resolve all of these challenges before going live to help ensure the organization can “hit the ground running.”
Timing
If a redesign of an organization’s job architecture is required, it is best to do so before undertaking the HCM system deployment. However, if that is not feasible, developing a new job architecture concurrent with the implementation work is possible and can be done without negatively impacting the implementation schedule.
Organizations that decide to do this should consider the following:
- Build your project plan around the milestone dates provided by your deployment partner. These are generally nonnegotiable as the deployment costs are based on meeting these deadlines and any work needs to be completed within this timeframe.
- Consider adopting an established job framework. This will help to ensure alignment with the market, reduce the time required to develop the job architecture, and decrease the burden on the human resources team.
- Prioritize the work and focus only on what is necessary to accomplish before going live.
For organizations that have already implemented a new HCM system and are seeing the consequences of not having harmonized or rationalized job structures, it can be difficult to know when to do the work. There may be fatigue from having recently gone through a large HCM system implementation or unease regarding additional change. Both are reasonable concerns. If significant change is not possible, organizations may consider modifying the attributes used to organize jobs in the HCM system rather than completely restructuring the job framework and compensation systems. While more significant action may be necessary in the long-term, small or modest changes in the structure of the job catalog can enhance value and functionality.
Conclusion
While some organizations may decide to implement a new cloud-based HCM system simply because they are phasing out their current platforms, most who embark on this journey are looking to secure greater insights in order to optimize their workforces, improve critical support functions and enhance organizational efficiency. Ensuring that best practices, effective internal structures, and technology-enabled processes are in place is the surest path to success.
1As Healthcare Turns to ERP, It Also Turns to the Cloud, Brian Eastwood, HealthTech, November 9, 2018.
2Getting the Most from Workday: It’s Not Just About Configuration. Darrell Cira and Susan Lokker, WorldatWork Training Course, October 2017.
3Don’t Sleep. Healthcare CIOs Must Step Into 2021 Now. David Chou, Forbes, May 21, 2020.
4ERP Software: Facts and Stats, Elizabeth Quirk, ERP Solutions Review, April 18, 2019.
5Hidden Challenges of Implementing a New HRIS on the Total Rewards Function. Darrell Cira, Rob Heir, Patrick Bostrom, Steven Seykora, Presentation at WorldatWork National Conference, May, 2015.
PRESS RELEASE | SullivanCotter Launches New Physician Needs Assessment
SullivanCotter Launches New Physician Needs Assessment Application to Support Critical Staffing and Service Line Requirements
September 15, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of rewards programs and workforce solutions for the health care industry and not-for-profit sector, announces the launch of its new Physician Needs Assessment (PNA). SullivanCotter’s PNA is an interactive, cloud-based application that delivers actionable, data-driven insight into physician supply and demand to help organizations identify, monitor and respond to changing service line needs and physician workforce staffing requirements.
By leveraging real-time market intelligence, custom analyses and tailored forecasting scenarios, this innovative new PNA application enables organizations to dynamically address emerging market trends, changing population demographics and evolving physician practice patterns.
Using proprietary benchmark data from over 1,500 organizations and 400,000 physicians, SullivanCotter’s advanced methodology analyzes more than 1 billion unique claims annually to accurately calculate the physician surplus or deficit within a specific area by determining supply, forecasting wRVU utilization and adjusting to various market-specific demographics – including geography, economic factors, age/gender, payment types and managed care – to calculate subsequent demand projections.
“In today’s increasingly uncertain marketplace, health care organizations remain acutely focused on recovery and what lies ahead in a post-COVID-19 operating environment. As hospitals and health systems look for better ways to support financial sustainability, assess clinical optimization opportunities, drive performance, and manage physician resources and service line needs, organizations must determine the right amount and type of physician specialties to operate effectively in the markets they serve ,” said Ted Chien, President and Chief Executive Officer, SullivanCotter.
Additional features and functionality include:
- A rigorously researched, call-verified and editable physician and APP supply roster based on multiple data sources that includes tracking of employment and affiliations
- Interactive mapping tool with the ability to select specific zip codes for strategic consideration and to account for any shifts in demographic mix
- Predictive modeling to assess the impact of virtual care, urgent care, retail health and more
- Advanced Practice Provider calculator to measure the impact of this workforce across specialties and their corresponding effect on physician supply and demand
- Comprehensive, customizable reports with 5-year rolling projections and automatic annual updates to demand defined by demographic and geographic data
- Archived reports providing strategic service area information and annual Stark compliance insights for measuring community need and assessing fair market value and commercial reasonableness considerations
Designed with the unique needs of leadership, physician and administrative stakeholders in mind, SullivanCotter’s PNA combines data-driven technology, industry-leading benchmark data and years of physician workforce consulting experience to provide organizations with the information and insights they need to inform key service line, practice and payer strategies in an evolving health care environment.
To learn more, request a demo, or view a full list of features and functionality, visit sullivancotter.com/PNA or call 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights and expertise to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.
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INFOGRAPHIC | APP Leadership Practices and Structures
Leadership Structures to Support Advanced Practice Provider Retention and Engagement
Advanced practice providers (APPs) comprise one of the fastest growing workforces in the United States and are integral to effective and efficient health care delivery.
Organizations are developing APP leadership structures to create comprehensive workforce strategies that focus on APP optimization, workforce planning, recruitment, retention, engagement and ensure alignment with physician workforce strategies.
Learn more from SullivanCotter's 2019 APP Workforce Practices and Structures Survey.
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ON-DEMAND WEBINAR | COVID-19: Impact on Physician and APP Workforce Strategies
Positioning Your Organizations for Success in the New Normal
View an on-demand record of this exclusive webinar hosted by the Health Forum/American Hospital Association - featuring data, insights and industry experts from SullivanCotter.
VIEW THE RECORDING
The impact of the pandemic has accelerated the need for strategic alignment between health systems and their employed and affiliated physicians and advanced practice providers (APPs).
As the industry begins to look ahead and plan for financial recovery and operational transformation, executive leadership should take this time to reassess their organization’s alignment strategies and affiliation models in order to identify key workforce and care delivery optimization opportunities.
Working in partnership with physicians and APPs, organizational leaders are evaluating ways to best position themselves to manage anticipated increases in volume, navigate the transition to value-based reimbursement, and support long-term financial sustainability.
During this webinar, industry experts from SullivanCotter will discuss:
- Physician and APP alignment strategies during and beyond the COVID-19 pandemic
- Key components for enhancing strategic alignment between physicians, APPs and health systems
- Leading practices in physician needs assessments and key considerations for primary care team optimization
- Emerging trends in physician and APP compensation
- The utilization of physician feedback and emerging performance management tools to aid in the development of core performance expectation and incentive plan metrics
PRESS RELEASE | SullivanCotter Launches Clinician Pay Functionality for PPMTTM
SullivanCotter Develops Powerful New Clinical Compensation Management Capabilities for its Growing PPMTTM Platform
September 1, 2020 – Chicago – SullivanCotter, the nation’s leading independent consulting firm in the assessment and development of total rewards programs and workforce solutions for the health care industry and not-for-profit sector, announces the addition of highly anticipated new Clinician Pay functionality to its growing Provider Performance Management TechnologyTM (PPMT) platform. PPMTTM is an industry-first, cloud-based solution that enables provider engagement through transparent performance-based compensation administration and analytical capabilities.
Clinician Pay enables administrative stakeholders to easily manage annual compensation draws and payroll adjustments through a centralized, secure and auditable source within PPMTTM. The new functionality can be added as part of the platform’s comprehensive Compensation Management Analytics module for an additional licensing fee. This module’s broader capabilities allow organizations to integrate physician compensation earned from all sources, review dollars paid and balances due, facilitate settlement reporting, project year-end results, model improvement scenarios and generate accruals for Finance.
“With this automated new functionality, health care organizations can significantly reduce manual intervention and potential for human error when managing important pay adjustments for a large clinical workforce. Not only does this help to free up administrators to work on more critical projects, but it also helps to ensure data quality and instill greater trust in the reporting process by seamlessly communicating important information straight to payroll for payment,” said Shelly Slowiak, Director, Product Support, Provider Performance Management Technology™
PPMT’s Compensation Management Analytics module plus the new Clinician Pay feature also provides the option to utilize payroll data for settlement processing - allowing for a comprehensive end-to-end solution for processing clinician payments and compensation adjustments.
“To help organizations navigate an increasingly complex and uncertain health care environment, we are continuously refining our product roadmap and enhancing PPMTTM based on the evolving needs of our clients. Clinician Pay is an exciting new addition to the platform and demonstrates our commitment to developing one of the industry’s most innovative clinical compensation and performance management solutions,” said David Schwietz, Chief Information Officer, SullivanCotter.
Designed to address a spectrum of physician, leadership and other key stakeholder needs, PPMTTM combines years of health care compensation insight and expertise with an intuitive and automated technology platform to help drive provider performance and support the transition from volume- to value-based care.
For more information on Clinician Pay or our entire suite of Provider Performance Management TechnologyTM, visit www.sullivancotter.com/PPMT or contact us at 888.739.7039.
About SullivanCotter
SullivanCotter partners with health care and other not-for-profit organizations to understand what drives performance and improve outcomes through the development and implementation of integrated workforce strategies. Using our time-tested methodologies and industry-leading research and information, we provide data-driven insights and expertise to help organizations align business strategy and performance objectives – enabling our clients to deliver on their mission, vision and values.