Focus on the Future

Incentives And Compensation Plans For Medical Groups And Healthcare Businesses

I dictated the first draft of this post on a Monday as I was driving to work.

I know a lot of people hate Mondays. I can’t tell you how much I want to slap somebody when they call a Wednesday a “Hump Day”, or when they say “it’s almost Friday!”

I just don’t think like that. I don’t understand why anyone does. That is, unless they hate their job. But, if that’s the case, why are they still working there, or doing that job at all?

Don’t tell me that they don’t have any choice, or that you don’t have any choice. No, we each have a choice. Our choices have consequences. We just might not like those consequences.

A lot of my clients, medical groups as well as other healthcare-related businesses, have a compensation plan that the owners think is simply a way of paying. That is, they think that the compensation plan is just about money.

Sure, compensation plans are about money, but they’re certainly not only about money.

Instead, compensation plans are tools for social engineering within your medical group, business, or organization. If there’s something that you want your colleagues or team members or employees to do, then compensate them for it. And, just as, or even more, important, ask yourself if you’re also compensating them in a way that causes them to do something that you don’t want them to do.

For example, let’s use the fast food joint that I just passed as I was dictating the first draft of this post as an example. The owner could give bonuses to the employees for quick services in the drive-thru lane. Sounds good, right? Let’s get the time per car down to 30 seconds!

But if you do that, are you disincentivizing your employees to take the time to speak with each customer? Will they take the time to make sure that the order is right and that the correct bag is given to the customer? Will they make sure that the mayo-free burger doesn’t come out with double mayo?

Understand that your compensation plan is just another piece of the puzzle. It works together with an employment agreement, an independent contractor agreement, a partnership agreement, and so on. Think about how it works in your context.

What are you paying for? How does that vary from what you’re currently getting?

It’s time to consider the incentives and the messages that you’re sending with each check.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

Continue Reading...

Manage Your Practice

Is Your Medical Group Stealing From Its Future?

You get what you pay for.

If you try to get it without paying for it, you won’t get much of it, at least not of high quality.

And you are probably stealing. The irony is that you are stealing from yourself, from your future.

Medical Group Compensation Plans

What does your medical group’s compensation plan compensate for? The usual answer is “productivity,” whether measured in units or minutes or by some other standard.

If your group compensates for X, you will get more of X. So if X is units, your group’s physicians will be motivated to maximize their production of units.

But if your group compensates for X and also wants Y, you will get a lot of X and not very much, if any, Y.

For many medical groups, Y is leadership. They want their group leaders to lead, but their compensation plans incentivize only the production of units.

Is it any surprise that the “leadership stuff” is relegated to the wee hours of the night or even to the wee hours of never? Is it any surprise that there’s no actual leadership, only “consensus?” Is it any surprise that the leaders schedule business meetings at 7 pm or on weekends, signaling amateur status?

If you don’t pay for leadership, you won’t get much, if any, of it. You will create tension. You will create resentment. But you will not create leadership.

You’ll be stealing from the leaders – either from their ability to generate units or from their time for themselves or with their families.

And, as a result you will get a very weak form of leadership, one that results in your group stealing from its own future in the form of poor decisions and lost opportunities.

You’ve got great plans to take over the region or to simply protect your position at one facility. You expect your leaders to achieve that goal. Yet you’ve incentivized them away from your goal. Don’t blame them when you never get there. Blame yourself.

It’s time to make sure that your group’s compensation plan is in synch with your group’s business strategy and future.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

Continue Reading...