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Health Care on the Other Side: Physician Compensation Models in a Post-COVID-19 Landscape

The COVID-19 pandemic has raised concern among health care leaders about the preparedness of acute care systems to adapt to and manage large-scale environmental disruptions. Current physician compensation models do not align incentives with the dynamic and unique strategic priorities of health systems, especially in the face of unforeseen circumstances.

Advancements in the health care landscape have accelerated in the last decade, and hospitals have been slow to respond. Value-Based Care has become the new normal, but organizations are still reconciling how to compensate physicians for their delivery of quality care that leads to patient satisfaction and positive health outcomes. Amid the pandemic, providers have hastily adopted more forms of telehealth to continue operations, further highlighting the need for a physician compensation structure that encourages experimentation with new technology.

Our novel Contribution-Based Incentive ("CBI") Model is established on measurable variable incentives that balance (i) productivity; (ii) quality; and (iii) citizenship. The CBI Model pairs stabilizing base salary with customizable core incentives in a point system, offering greater career autonomy to physicians. Customizable pay levers motivate providers based on their productivity, quality outcomes, organizational stewardship, and degree of clinical and extracurricular engagement.

By allowing for different combinations and weights of the three core incentives, systems can align compensation with the individual needs of their physicians and the overall strategic priorities of the organization to fundamentally reshape the physician-hospital relationship.

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