Workforce Compensation and Performance Improvement Resources

SullivanCotter Releases 2012 Survey of Manager and Executive Compensation in Hospitals and Health Systems

According to SullivanCotter’s 2011 Physician Compensation and Productivity Survey, over half (59 percent) of survey participants have increased the size of their APC workforce within the past 12 months. Of these, the average increase was seven APCs. Sixty-one percent of survey participants indicated that they plan to increase the size of their APC workforce in the next 12 months. Of these, the average increase will be six APCs.

Compensation is usually a taboo conversation in every industry. Interestingly, health care leaders don't mind talking about how they calculate physician salaries, but don't ask them to chat about how they calculate their own. That conversation quickly runs dry.

A key factor noted in the opinion is that, based on an independent valuation, the hospital certified that the per diem rates are commercially reasonable and fair market value for the services provided.

Although the rule does not apply to not-for-profit health care and was not written with this sector in mind, it provides helpful guideposts for such organizations given the potential for governance-related "spillover" from the public company sector. Compensation committees in the not-for-profit health care sector would be well-advised to consider the extent to which applying the prescribed compensation advisor independence factors would strengthen their decision-making process, as conflicts of interest (real or perceived) can compromise an effective executive compensation governance process.

Though few external benchmark resources are available to help create the guiding metrics, boards continue to try to shift away from rewarding solely on organization-wide financial performance and move toward incentivizing for quality and patient satisfaction. Ultimately, though, fiscal goals still dominate when it comes to incentivizing the C-suite.

Each year, Modern Healthcare publishes a list of the "Best Places to Work in Healthcare." For this year's article, SullivanCotter Managing Director Chris Terranova Asselta was interviewed for her reaction to what organizations must do to create great work environments.

When hospitals and health systems need to re-evaluate their expenses, benefits programs are usually among the first areas to succumb to the chopping block, but providers should look closely at all benefits programs before making any cuts, according to a whitepaper from SullivanCotter

Meeting budget expectations is a very important goal for any not-for-profit organization. However, to run a successful organization – both from a mission and financial standpoint – keeping a strong leadership team is an important goal as well. Therefore, while executives experience the impact of broadbased benefits cost-reduction initiatives, maintaining an attractive, competitive compensation program for executives is key.