Effective Compensation Design: Why It Matters for Your Medical Practice
Recruiting and retaining talent is a constant challenge for any business, but it tends to carry more weight in the context of a medical practice. Practice leaders must worry about physicians’ financial incentives in addition to market requirements for quality, outcomes, and the patient experience. Without a plan for how to compensate physicians, it can be difficult to meet these competing needs.
A well-structured compensation plan gives you a guide for paying your physicians while helping your practice meet market requirements. Here are four questions to ask when designing a compensation plan for your medical practice.
Although answering this question can be a complicated, it’s important to make sure the process is inclusive. Consider sitting down and interviewing your physicians and be sure to get everyone’s input. Compare your practice’s data points to those published in national surveys. Review your payer contracts. With a holistic view of your practice, you’re able to determine the type of practice you want to be—or should be—and move forward with designing a compensation plan that will recruit and retain providers who will help you get there.
This may be the most critical component of designing a compensation plan for your medical practice. Your physicians need to understand how it affects them. Any buy-in or financial confidence you’ve instilled in your compensation plan will be worth nothing if your physicians can’t decipher what it means.
How—and not just how much—you pay your physicians matters. There are many options for how you can go about structuring your practice’s compensation plan. But in order for your plan to be successful, it must reflect your goals for the practice, be supported and understood by your physicians, and remain financially viable for years to come.
The healthcare team at DS+B is available to support you in designing a compensation plan for your practice. To learn more, give us a call today.