Most physicians get an annual performance review, and may be either elated, disappointed, or confused with their rating.
But some physicians say the right factors aren’t being evaluated or, in many cases, the performance measures promote efforts that are counterproductive.
“Bonuses are a behaviorist approach,” said Richard Gunderman, MD, professor in the schools of medicine, liberal arts, and philanthropy at Indiana University, Indianapolis. “The presumption is that people will change if they get some money – that they will do what the incentive wants them to do and refrain from what it doesn’t want them to do.”
Dr. Gunderman said this often means just going through the motions to get the bonus, and not sharing goals that only the administration cares about. “The goals might be to lower costs, ensure compliance with regulations or billing requirements, or make patterns of care more uniform. These are not changes that are well tailored to what patients want or how doctors think.”
The bonus is a central feature of the annual review. Merritt Hawkins, the physician search firm, reported that 75% of the physician jobs that it searches for involve some kind of production bonus. Bonuses often make up at least 5% of total compensation, but they can be quite hefty in some specialties.
Having to fulfill measures that they’re not excited about can lead physicians to feel disengaged from their work, Dr. Gunderman said. And this disengagement can contribute to physician burnout, which has climbed to very high rates in recent years.
A 2018 paper by two physician leadership experts explored this problem with bonuses. “A growing consensus [of experts] suggests that quality-incentive pay isn’t paying the dividends first envisioned,” they wrote.
The problem is that the measurements tied to a bonus represent an extrinsic motivation – involving goals that doctors don’t really believe in. Instead, physicians need to be intrinsically motivated. They need to be inspired “to manage their own lives,” “to get better at something,” and “to be a part of a larger cause,” they wrote.
How to develop a better review process
“The best way to motivate improved performance is through purpose and mission,” said Robert Pearl, MD, former CEO of the Permanente Medical Group in California and now a lecturer on strategy at Stanford (Calif.) University.
The review process, Dr. Pearl said, should inspire physicians to do better. The doctors should be asking themselves: “How well did we do in helping maximize the health of all of our patients? And how well did we do in avoiding medical errors, preventing complications, meeting the needs of our patients, and achieving superior quality outcomes?”
When he was CEO of Permanente, the huge physician group that works exclusively for health maintenance organization Kaiser, Dr. Pearl and fellow leaders revamped the review system that all Permanente physicians undergo.
First, the Permanente executives provided all physicians with everyone’s patient-satisfaction data, including their own. That way, each physician could compare performance with others and assess strengths and weaknesses. Then Permanente offered educational programs so that physicians could get help in meeting their goals.
“This approach helped improve quality of care, patient satisfaction, and fulfillment of physicians,” Dr. Pearl said. Kaiser Permanente earned the highest health plan member satisfaction rating by J.D. Power and higher rankings by the National Committee for Quality Assurance.
Permanente does not base the bonus on relative value units but on performance measures that are carefully balanced to avoid too much focus on certain measures. “There needs to be an array of quality measures because doctors deal with a complex set of problems,” Dr. Pearl said. For example, a primary care physician at Permanente is assessed on about 30 different measures.
Physicians are more likely to be successful when you emphasize collaboration. Dr. Pearl said.
Although Permanente physicians are compared with each other, they are not pitted against each other but rather are asked to collaborate. “Physicians are more likely to be successful when you emphasize collaboration,” he said. “They can teach each other. You can be good at some things, and your colleague can be good at others.”
Permanente still has one-on-one yearly evaluations, but much of the assessment work is done in monthly meetings within each department. “There, small groups of doctors look at their data and discuss how each of them can improve,” Dr. Pearl noted.