Physician performance-based compensation gaining ground

The way physicians are paid is evolving, as evidenced by the results of two recent compensation surveys--one looking back at 2012 and the other forecasting for 2013. According to both the Physicians Practice "2012 Physician Compensation Survey" and the Hay Group's "Annual Physician Compensation Survey," physician pay is becoming increasingly linked to various performance measures, forcing doctors to think differently about the way they provide care.

For example, out of the 1,311 respondents to the Physicians Practice survey, one-third said that at least 20 percent of their income is not guaranteed but dependent on metrics, such as patient satisfaction. When asked what their 2012 income was largely based upon, 61 percent said productivity; 23 percent said "value of care," and 16 percent said "value and outcomes."

The Hay Group's study found that annual incentive plans have remained prevalent, used among 80 percent of the surveyed group-based practices and 63 percent among hospital-based physicians. In particular, 77 percent of organizations surveyed said physicians' individual performance metrics relied on "quality," while 66 percent received incentive payments for "patient satisfaction." As with the Physicians Practice Survey, the Hay Group found pay linked to "outcomes" to be the least popular, at 39 percent.

However, according to some experts, patient outcomes may represent more relevant information than patient satisfaction, as a recent study found that the pressure to satisfy patients may lead doctors to provide more unnecessary care.

To learn more:
- read the press release from the Hay Group via CNBC
- see the survey from Physicians Practice

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