Healthcare Issues & Trends

Advice & Insights for healthcare's Leaders & HR Professionals

Following Changes in Healthcare Salary Increases, Incentives, and Benefits

Posted on December 13, 2011 by Gallagher Integrated

Two years ago, following the economic downturn, we began conducting a Salary Increase, Incentive, and Benefit Updates Survey to capture a consistent measure of changes occurring in compensation during the downturn and recovery periods.  During a time when costs are closely monitored, this type of intelligence affords hospitals and health systems valuable insights into the past, current and future compensation plans of other healthcare organizations nationwide. Our study includes executive, middle management, and staff positions.  Questions found in the current survey target: • Organizational demographics • Salary increase budgets for executives, middle management, and staff positions • Executive incentive plan modifications and performance criteria • Post-retirement medical benefit offerings Following is an excerpt from our spring 2011 survey summary:

Pay Increases Stabilizing The results of the survey indicate that roughly 80% of hospitals and health systems are either leaving 2011 salary increase budgets unchanged or increasing budgets from 2010.  Although salary increases for executives, middle management, and staff-level employees continue to be at levels below historical trends, the survey found that budgeted salary increases are slightly higher than the levels reported in our earlier surveys.  Our spring 2010 survey reported projected median salary increase budgets for 2010 of 2.5% for executives and 2.6% for both middle management and staff-level employees.  The median budgeted salary increases for 2011 from this year’s survey is 2.8% for executives and middle management and 2.6% for staff.  We expect these numbers to continue to increase at a conservative pace during the second half of 2011 and into 2012.  Organizations should anticipate budgeting for slightly higher salary increases moving forward. The most common factors cited as reasons for changes to salary increase budgets were: actual financial performance in 2010 and 2009, regional or local salary trends, and industry salary trends.

Our latest Salary Increase, Incentive, and Benefit Changes Survey is currently open as we continue our examination of healthcare organizations' reactions to economic challenges, recent legislation, and compliance requirements impacting compensation and benefit practices. All participating healthcare organizaiton will recieve a free copy of the survey report.

To participate in this survey, click on the link below.  Please note that in the interest of capturing the most relevant and accurate data for our study, the survey is only open to CEO, COO, CFO, and HR executives within healthcare organizations.

Participate in Survey

Please note: This survey must be completed and submitted in a single session; answers cannot be saved to submit at a future date.  Responses are confidential and data is only reported in the aggregate.

Participation Deadline Extended:  January 13, 2011

Medical Director Compensation Trends

Posted on December 5, 2011 by Gallagher Integrated

Our Physician Services practice recently published the results from the latest 2011 survey on the trends in Medical Director compensation. The results showed some intersting highlights and trends - important for hospitals and healthsystems to stay up-to-date on give medical directors today serve an important management role in just about every hospital in the country.  Because of the increase in duties and the work hours required, physicians in these roles are demanding that hospitals provide them with reasonable compensation for their work effort. If hospitals want to attract qualified physicians to medical director roles, they'll need to provide a competitive level of pay, but must also ensure that the payments to physicians for these services comply with regulatory guidelines. Following are results from the 2011 Medical Director Survey showing trends related to contracts for these positions:

  • 82.3% of organizations reported that all of their medical directors have contracts
  • 72.9% of contracts are for a term of only 1 year, a percentage that has increased for the fourth consecutive year
  • 78.0% of contracts require a physician to log their time, the highest percentage since the first Medical Director Survey published in 2003

The 2011 Medical Director Survey also takes an in-depth look at the data and methodology of individual compensation across 92 medical director positions.  Trends related to compenation for these positions included the following findings:

  • Independently contracted medical directors are paid 3.9% higher on average than employed medical directors, most likely accounting for foregone taxes, benefits, and insurance payments
  • 26.9% of organizations offer their medical directors performance bonuses, an increase from 22.6% in 2010
  • On average, median hourly rates increased by 3.0% from 2010 to 2011

For the full summary report, please click here. If you have interest in becoming a participant of this survey, here's your heads-up that the 2012 Medical Director Survey is expected to open in March.  If you'd like more information about the survey, including a sample position page and position list, you may go online or email us at Participating healthcare organizations will get a free copy of the report.

Strengthening Public Hospital Governance

Posted on December 1, 2011 by Gallagher Integrated

Biennially, The Governance Institute (TGI), an organization that provides education and information services to hospital and health system boards of directors across the country, conducts a topical survey.  This year's 2011 survey, "Dynamic Governance," provided an analysis of board structure and practices in a shifting industry.  We are pleased to note that due to his involvement in this project, James A. Rice, Ph.D, FACHE, Executive Vice President specializing in governance and physician leadership for Integrated Healthcare Strategies, we are able to share a special commentary report based on the results of the survey.  Dr. Rice is also vice chairman of TGI. This special commentary piece notes the continued paradox with respect to the boards of hospitals in the "government-sponsored" category. Findings support that boards of these organizations are relatively weaker than of non-profit community hospitals. If you'd like to read the commentary in full and see the comparisons of these hospitals to all others, click here to download the white paper. To contact Dr. Rice with questions or comments, email him at or call 612.703.4687.

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