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4 Keys to Boosting Provider Retention with Compensation Technology

Provider disengagement – and the instability it creates in relationships between providers and their employers – can have serious consequences. Physician groups that lack engagement have low adoption rates when it comes to organizational strategy, which can negatively impact revenue, patient care, communication, and staff satisfaction.

Lack of transparency breeds provider disengagement – and often distrust, particularly in the area of compensation. That means your compensation division has an important role to play in provider retention. As physician shortages worsen and value-based care gains traction, the need to engage and enlighten providers on the link between performance, outcomes, reimbursement, and compensation has never been greater.

To help organizations implement effective engagement and retention strategies, Hallmark Health Care Solutions recently hosted a webinar, “Optimizing Provider Engagement with Modern Compensation Technology.” Here are four essential ways the right technology solution will increase provider engagement and retention.

1: Accuracy

One of the easiest ways to lose provider trust is to pay them inaccurately. “I’ve personally seen financial and operational administrators have to rebuild clinical teams because relationships with providers were tarnished beyond control from distrust in their compensation payments,” says Heisenberg II Vice President and former physician comp director Aarika Cofer.

Building trust means more than just eliminating quantifiable errors. Compensation must be verifiably error-free, which means all calculations should be visible and traceable. Automating compensation models is a necessity to help eliminate human error in complex compensation modeling. For more information on the role of automation in increasing accuracy, read “3 Ways to Improve ROI with Automation in Physician Compensation.

2: Transparency

Because provider compensation has several moving pieces, ongoing transparency into performance is critical. Similarly, providers need and want to know where they stand compared to industry benchmarks. If they are paid below market, that’s not the end of the world, but they must understand why. That requires visibility and communication.

Dr. Lynn Myers, the Chief Medical and Quality Officer for Texas Health Physicians Group (THPG), spoke to this concern in the webinar, describing how their group uses technology (Heisenberg II Physician Compensation) to give providers access to productivity and performance data as it relates to compensation. With real-time reports and performance dashboards, providers can understand how they’re doing at any given moment in time. Critically, the technology breaks it down in ways that make it easy to understand the intricate details of their compensation.

“We also do a fairly broad communication across the organization,” Myers added. “We have committees that are physician-led and committees that have both physicians and advanced practice providers. We survey our providers twice a year and provide the results of those surveys, and any actionable changes that result from those surveys, wherever possible.”

3: Administrative ease

Compensation models can get complicated, so organizations must have clear and concise ways to communicate and administer them. If providers have limited understanding as to how they’re being compensated, they will not engage in the activities that boost their compensation – at least not as fully and robustly as you need them to.

Dr. Shawn Parsley, President and CEO of THPG, explains how transparency and administrative ease are closely linked: “Without technology, providers had to wait for a monthly or quarterly report that would be delivered in paper or email. Our former systems provided accurate reporting, but they did not provide ease of access – a place for providers to go whenever they want to see how they’re performing.”

4: Compliance

Providers must trust that their organization is protecting them through regulatory auditing, fair market value assessments, and HIPAA-compliant reporting. Without these key practices, organizations can find themselves using compensation as engagement tools in inappropriate ways. This mishandling of resources will not only hurt the organization’s success, it will also create unhealthy relationships with the providers.

Technology can facilitate compliance-related change management. For instance, in 2021, the Centers for Medicare & Medicaid Services made significant changes to wRVU rates, which profoundly impacted the compensation function. Dr. Parsley explained how having a compensation management technology like Heisenberg II PC helped smooth those changes with providers at THPG:

“The rate changes led us to make adjustments at the organizational level, ultimately intending a 3% to 5% increase for providers while lowering wRVU rates. From a change management perspective, that’s a pretty difficult process. The use of technology really helped because providers were able to see that month to month, compared to previous performance, their production was stable and that they were getting about a 3 to 5% increase overall. Without the help of the technology, that very difficult transition in 2021 would have been much more challenging.”

Turning these principles into action

Compensation technology offers a clear path to a successful compensation program that can meaningfully improve retention of top clinical talent. A 2022 report released by CHG Healthcare found 43% of physicians switched jobs during the pandemic, 8% retired, and 3% left medicine to work in a non-clinical career. Most cited work-life balance as a key factor in their choice to leave jobs where they feel “overworked or underappreciated.” Finding ways to boost physician engagement and retention is more critical than ever.

Use the information above to consider what the right compensation management technology can do for your organization. Watch the full webinar to examine these related topics and more:

  • What is the difference between a fragmented operational system and a federated operational system, as they relate to provider relationships, engagement, and retention?
  • What are the six pillars of provider engagement?
  • How do top-performing organizations like Texas Health Physicians Group handle change management?
  • What role does technology play in fostering positive relationships with providers, including APPs?