Seeing more and more production-based compensation plans

As medical group practices face changing reimbursement structures and increased operating costs, aligning physician compensation plans with organizational goals is critical. Many practices achieve this alignment by using productivity-based compensation models.

As practices struggle to improve the bottom line, it is clear that instituting production-based compensation plans encourages physicians to work harder and allows them to earn more. By aligning physician incentives with those of the group, physicians and administrators are empowered to make decisions in their best interests and help the organization succeed.

But remember this………if you have or do implement a pure productivity-based compensation plan, make sure you don’t create an “environment” whereby you end up having a bunch of “solo practitioners” masquerading as a group practice. In other words, you need to make sure that somewhere there is “glue” within the group practice to keep in together.

About the Author

Reed Tinsley CPA

This article is written by Reed Tinsley, a Houston, TX-based CPA with over 30 years of experience advising physicians and medical practices across Texas and the United States. Reed holds certifications as a Certified Valuation Analyst (CVA), Certified Healthcare Business Consultant (CHBC), and Certified Financial Planner (CFP), specializing exclusively in the healthcare sector. He is a published author, nationally recognized speaker, and trusted advisor to physicians on accounting & tax, practice management, and financial planning. Schedule a Free Consultation.