Follow the Money
I eagerly await results from SHM’s survey of hospitalist productivity and compensation every two years. I’m most curious about whether a typical hospitalist has experienced an improvement in his/her “juice to squeeze ratio” (aka compensation per unit of work).
I was pleased to see in the recently released “Society of Hospital Medicine 2007-08 Survey: The Authoritative Source on the State of the Hospitalist Movement” that average hospitalist salaries increased the most for any two-year interval since we began surveying in 1997. If you haven’t seen the survey results, go to SHM’s Web site www.hospitalmedicine.org. Production remained flat, while compensation increased to an average of $188,500. (The survey showed an adjusted mean annual compensation of $193,300, and a median salary of $183,900. See complete survey for explanation regarding the adjusted mean, which refers to data for hospitalists who care for adult patients only.)
The 2008 survey has a couple of findings even more compelling than the gratifying improvement in compensation:
- 37% of HMG leaders did not know their annual expenses; and
- 35% of HMG leaders did not know their annual professional fee revenues.
Think about this for a minute. One-third of hospitalist group leaders don’t know enough about their own practice’s financial picture to know high-level details related to income and expenses. We only can presume an even larger portion of non-leader hospitalists don’t know these things about their practice.
These numbers are disconcerting, and they’re even a little worse than the numbers reported two years ago. How can this be?
Behind the Numbers
My first inclination is to look for reasons the data are misleading. Maybe some leaders chose to respond by indicating they don’t know these numbers, when in fact they do have the numbers but were just too busy to look them up and complete that part of the survey. So they might be better informed than the survey suggests, but just too busy to demonstrate it.
Or, some group leaders in large organizations, like Kaiser, may track and account for productivity and financial health in ways that differ from a typical practice. They may know a lot about their practice, but the metrics the survey asks for aren’t relevant to them.
Maybe the survey results are misleading and group leaders know a lot more about their practice financials than these numbers suggest. Well, maybe.
Unfortunately, in my consulting work up close and personal with hundreds of practices, I regularly meet group leaders who don’t see financial accountability as one of their duties. I think the survey numbers may be a reasonably accurate reflection of reality.
I typically ask group leaders things like what portion of their practice budget is funded by professional fee collections vs. payment from the hospital (or other “sponsoring organization”) and what the pro fee collection rate is. As in the survey, a large portion don’t know. They often say it’s up to someone else to keep track of those numbers and worry about the practice budget. I worry that a leader with such a hands-off approach to the practice budget can’t be very effective.
I also ask leaders things like what is their most important duty as group leader. “Making the schedule” is too often the disappointing answer. Clearly the schedule is a critical part of operating a practice, but in many practices it is reasonable, even optimal, to have a clerical person manage the schedule, or rotate responsibility for creating it among all members of the group. This frees some time the leader can spend on other activities like managing the group’s financial performance, among other things.
