Can a performance bonus help?
by John Nelson, MD, MHM
Hospital medicine is fortunate to have many very dedicated and professionally centered doctors who work enthusiastically to both provide excellent care to their patients and work to make their own practice and their hospital a better place. I am lucky to practice with many of them in our practice in Bellevue, Wash.
Yet a significant portion of hospitalists have chosen this work because they’re looking for relatively-low-commitment work. In essence, they see themselves as dating their practice rather than marrying it. Some of them might even say, “I thought I wanted a career. It turns out all I wanted was a paycheck.”
Most are skilled clinicians who find the energy to do a good job for the patients under their care but don’t have a mindset of owning their practice and investing time in making it perform better.
This gives rise to a dilemma: How can a practice turn these perfectly capable physicians into meaningfully engaged participants in the hospitalist practice itself and the hospital as a whole? What about a salary bonus based on good citizenship? Would that cause them to become more engaged and committed?
There is voluminous research and a whole row of books at your local Barnes & Noble that address these questions more completely that I can, so I’ll just share some real-world experience and insights from one book.
There are a number of ways to consider designing a citizenship bonus. At a previous SHM practice-management course, Win Whitcomb, MD, MHM, presented one example from Mercy Medical Center in Springfield, Mass. (see Figure 1).
The following kinds of activities might be appropriate for a hospitalist to earn a citizenship bonus:
From the experience Mercy Hospital had with the citizenship bonus, Win concluded that many, but not all, hospitalists who don’t seem interested in quality improvement (QI) will become engaged if there is a reward/recognition structure. A relatively small dollar bonus is OK, as long as non-monetary rewards exist (e.g. improvement demonstrable, sense of teamwork, recognition). And hospitalists who were engaged prior to establishing the salary incentive are not likely to change their behavior, but their effort is now recognized—allowing for sustained engagement.
I’m sure many institutions would find a similar desirable outcome from putting into place a citizenship bonus. But it isn’t a guarantee. All performance bonus programs, whether based on “hard” outcomes like patient satisfaction scores or “soft” things like citizenship, are tricky to set up and operate effectively.
I have seen well-intentioned efforts to create a citizenship bonus lead to an increase in hospitalists working on projects outside of direct patient care, but at a cost of leading them to focus more intently on just how much they’re being paid for any work outside of direct patient care. It seems that the bonus might have ignited more frustration and concern about compensation, and any benefit to the practice might have been offset by harm to group culture. And if the bonus goes away, some doctors might be even less engaged than they were before it was turned on.
In “Drive: The Surprising Truth About What Motivates Us,” Daniel Pink makes a pretty convincing case that “the more prominent salary, perks, and benefits are in someone’s work life, the more they can inhibit creativity and unravel performance.” He makes the case that organizations are most demotivating “when they use rewards like money to motivate staff.”
“Effective organizations compensate people in amounts and ways that allow individuals to mostly forget about compensation and instead focus on the work itself,” Pink writes.
How do you allow individuals to forget about compensation? He says ensure internal and external fairness in compensation; pay more than average; and if you use performance metrics, make them wide-ranging, relevant, and hard to game.
So maybe financial compensation for citizenship, whether paid through a bonus, hourly, or some other separate salary element, isn’t such a good idea for a hospitalist practice (or any physician practice?). I don’t have a definitive answer, so you’ll have to decide this for yourself. But my hunch is that groups with a thriving culture might in some cases benefit from a well-designed citizenship bonus. That said, those groups also could be the ones less in need of it.
Groups that already have a weak or unhealthy culture, or are frustrated by what they see is inadequate compensation for clinical work, might find such a bonus leads to problems that offset its benefit.
Training in leadership, quality improvement, and other non-clinical areas that are critical for the success of a hospitalist practice is always worthwhile and might capture many of the benefits of a citizenship bonus without its drawbacks.
Dr. Nelson has been a practicing hospitalist since 1988 and is co-founder and past president of SHM. He is a principal in Nelson Flores Hospital Medicine Consultants, a national hospitalist practice management consulting firm (www.nelsonflores.com). He is also course co-director and faculty for SHM’s “Best Practices in Managing a Hospital Medicine Program” course. This column represents his views and is not intended to reflect an official position of SHM.
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