Traditional contract management solutions really struggle to handle the complexities of physician...
How to Make Your Provider Compensation Team More Effective
Q&A with a Former Provider Compensation Director
Aarika Cofer is Vice President, Heisenberg II, at Hallmark Health Care Solutions. With more than a decade of experience working with hospitals and medical groups, she has a frontline understanding of the challenges facing compensation professionals today. She also has a unique perspective on the Heisenberg II Physician Compensation solution, having worked both before and after implementation of that solution with a former employer.
Today, Aarika is answering questions about the challenges she and her team faced, and how they changed after implementation of Heisenberg II Physician Compensation.
What was the top challenge you and your former team were facing before implementing Heisenberg II Physician Compensation?
We didn’t have the capability to recognize what was clinical versus nonclinical activity. Because providers are incentivized based on different types of activities, we needed to be able to track performance per pay element. But when we were still using spreadsheets, the only way to segment out compensation in a report was to separate out the payroll data and payroll codes by hand. Even that was imperfect, because we had one payroll code that rolled many different activities into it. I couldn’t see subsections of that payroll code to identify what pay elements were actually included. It was a very manual process just to understand what was productive pay.
How did that complexity and lack of visibility affect your team?
Our compensation analysts were not being utilized to top of their licensure, so to speak. The analysts could aggregate data and produce compensation statements, but they were unable to do any type of analytics as it pertains to compensation because they were so bogged down with time-consuming, manual data aggregation.
As a result, it was very difficult to figure out what the global impact to compensation would be, due to that lack of visibility and production. We couldn’t pull a full picture out of a global report and report back to leadership with strong intel on gaps projected in the pipeline. All we could report on was how much our providers were being paid in total – which was an estimate based on rates and expected wRVUs – and from there, we would make a guess about the potential impact.
How did all that improve once your organization implemented Heisenberg II Physician Compensation?
With Heisenberg II Physician Compensation solution in place, we were able to segment out those pay elements and recognize how the doctors, Advanced Practice Providers (APPs), and even hospitalists were getting paid for each of those components. That visibility enabled us to perform more meaningful evaluations and engage in better strategic planning.
It worked seamlessly because Heisenberg II Physician Compensation automates data aggregation. In other words, all that data we had been entering ourselves started interfacing directly into the system, cutting down manual data entry by at least 75%, which meant we could reallocate our staff from data management to more strategic work. By the time I left the organization, the compensation administrators were validating the compensation statements, and they were responsible for pulling regulatory reports and feeding them into existing performance models for each of the practices. So, they went from spending most of their time on data entry and guesswork to being empowered and equipped to interpret that data in meaningful and useful ways.
What kind of meaningful interpretations were you able to start doing?
With the ability to compare compensation directly to production, we started modeling what a provider’s rate should be according to market value or some other benchmark. Because Heisenberg II enabled us to stop other data noise from being mixed in – so we could see what productive comp was – we could determine whether providers were being overpaid or underpaid for the amount of production they were actually putting out.
We also started doing some useful analytics. For example, under a productivity-based compensation model, the most fundamental temperature check you can do is to put it on a stagger plot. You should be able to see a diagonal line of production to compensation. When you find outliers, that’s where you can start having some conversations around how to make those gaps tighter.
Did the fact that Heisenberg II Physician Compensation interfaced directly with other systems affect the quality of the data?
Before Heisenberg II Physician Compensation, if I had asked for all wRVUs for the last three months, the analysts might have pulled the data from any one of three systems – producing three versions of the same data – and no one could say which data set was exactly correct. That led to so much scrubbing of the data to try to validate it. Heisenberg II Physician Compensation eliminated all that effort and uncertainty.
For example, under our manual, pre-Heisenberg II processes, if we were going to meet with an APP to review his or her rate per wRVU (or base salary) and verify that compensation is correct, we would have to complete the reports at least a week early. It would take us three to four iterations before the data was clean enough to be presented to operations. After implementing Heisenberg II Physician Compensation, that validation period was cut at least in half because it took only one or two iterations to make sure it was accurate and complete.
Did the providers notice any differences?
Absolutely! We received a lot of very positive feedback from our physicians and providers about their ability to understand their compensation calculations. It remedied the friction and distrust that had become so prevalent among our providers – distrust that made for awkward, unengaged conversations with our doctors and APPs. All those issues went away once we had the Heisenberg II Physician Compensation solution because we could show more detail about their compensation, specifically related to quality, production, panel size, and so on. They were able to understand and build trust in the system.
That’s great, and it’s very important for building strong relationships with your clinical teams to support physician/provider retention. Final thoughts – besides what you’ve already mentioned, such as improved efficiency, transparency, and accuracy, what else does Heisenberg II safeguard against for healthcare enterprises?
Another important benefit is that it addresses a very common concern where compensation divisions are built organically and run manually: the risk of losing essential institutional knowledge when provider compensation professionals leave the organization. For example, when we implemented Heisenberg II Physician Compensation, we downloaded an incredible amount of information that previously only our comp manager knew. There were no manuals, no written instructions. Heisenberg II allowed us to make that information available to the entire compensation division and add process to all the comp models so anyone could pick it up. That’s another great example of a serious pain point that Heisenberg II solved for us – and it can do the same for any organization that compensates providers, no matter how complex.
To further explore these benefits and more, contact Aarika at email@example.com or visit Heisenberg II Physician Compensation online and request a demonstration.