We Need a Better Compensation system1 Kimberly D. Elsbach University of California, Davis Jan Kees Elsbach CEP America into her desk chair with a sigh, being careful to avoid spreading the blood stain on her shirt to the chair fabric.
Finally, another 10-hour emergency room (ER) shift in the books. Only a few notes left to write, and she would be out of hospital and on her way home to bed and six solid hours of sleep before she had to be back to lead tomorrow’s staff meeting. Then she remembered the agenda—review the compensation and bonus system for the ER physicians and get their approval on a new plan. That wasn’t going to be easy. The ER doctors were sharply divided in their preferences for a compen sation system. Some wanted a system that kept a communal atmosphere in the group, where everyone worked equally hard and was paid accordingly. Others felt like they were D r. Padma Singh, Director of Emergency Medicine at Westlake Hospital, collapsed 1This fictional case is based on the second author’s 20-plus years of experience working in actual emergency rooms in five large cities throughout the United States. carrying more of the load and should be compensated for that. It was clear from looking at monthly records that some doctors routinely treated more patients than others. Dr. Singh wanted the system to motivate the group rather than add dissatisfaction. Padma groaned and buried her head in her hands. She now doubted that she’d be get ting a good night’s sleep after all. She had three alternative plans to present to the physi cians in the morning, and she wondered if they would accept any of them. Background on Westlake Hospital and the Emergency Physicians of Sacramento Group Westlake Hospital is a privately owned, 162 bed, full-service hospital located in Sacramento, California. Westlake serves a mostly working-class patient population who rely on government insurance such as MediCal or Medicare. The hospital staffs its 29-room ER with doctors from a privately owned, physicians group called Emergency Physicians of Sacramento, or EPS. EPS has 20 physician members who staff their sister hospital, Eastlake, in addition to Westlake. Thus, EPS is a service provider for Westlake Hospital, and Padma Singh and the other 19 EPS physicians are not employees of Westlake Hospital, but employees of EPS. Working in the ER at Westlake When ER doctors work at Westlake Hospital, they work in teams of two. One doctor is the “triage doctor,” who sees all patients in a “triage room” shortly after they arrive, and the second doctor is the “follow-up doctor” who sees patients, who are deemed in need of a higher level of care, in actual ER treatment rooms. The triage doctor interviews and briefly interacts (approximately three minutes) with all new patients after they have checked into the ER. If the triage doctor determines that the patient needs to be seen by the follow-up doctor, he or she will pre-order tests or treatments (e.g., blood tests, urine tests, X-rays, or scans) that are likely to be needed by the follow-up doctor. This pre-ordering of tests saves time for the patient because the follow-up doctor will have the test results sooner and will be able to diagnose the pa tient sooner. Because the triage doctor has limited information about the patient when he or she orders the tests, however, this doctor may “over order” to cover all likely tests that might be needed. In about half the cases, the triage doctor may determine that the patient doesn’t need to be seen by the follow-up doctor, and may send him or her to the “Fast Track” clinic that is attached to the ER and staffed by physician’s assistants (PAs) and nurse practitioners (NPs). The triage doctor will see an average of 80 patients dur ing a 10-hour shift. But the triage doctor gets “credit” (explained later as “charge points”) only for those patients that he or she sends to the Fast Track (about 40 patients per shift). These patients also tend to have milder issues, and typically have lower charge levels (also explained below). Patients that go to the follow-up doctor are credited to that doctor. The triage shift is a high-intensity job that is emotionally and mentally draining, and least preferred by most doctors. As a result, more of these less desirable shifts are dispro portionally filled by more “junior” physicians. The triage shift was added about a year ago in response to an ER audit that showed that patients were waiting too long (sometimes several hours) before being seen by a physician. It was clear from feedback forms that the issue of long waiting times was most responsible for patient dissatisfaction. By contrast, the follow-up doctor performs a more traditional role in the ER. The follow-up doctor examines patients in examination rooms, based on the order of arrival, unless immediate attention is needed. The follow-up doctor performs a more thorough physical exam of the patient and may order more tests if necessary. Patients seeing the follow-up doctor have, typically, two final outcomes: ER treatment and release, or ER treatment and admission to the hospital. In a typical 10-hour shift, the follow-up doctor will see 25–30 patients, and will get credit for all of these patients. Physician Compensation at EPS Levels of Charge and “Charge Points” EPS collects fees for its doctors’ services directly from insurance companies based on a five-level formula—the higher the level, the greater the fe
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