Medicine

Incentives are good things!

By Chris Rangel MD ⋅ July 18, 2007 ⋅  Email this post ⋅  Print this post ⋅ Post a comment

The problem with employee physicians Part II - Alijor is right (see Part I). As the Canadian health service and the UK’s NHS have found out, incentive based work arrangements can be critical to the success of their systems.

There are good and bad points to being a salaried employee physician but let’s never underestimate the value of good incentives. An example from my own experiences; a few years ago a company had two salaried physicians in its employ for a hospitalist program. Over time their census grew to 40-60 patients. The company was unable to find a third physician to hire and so in the mean time they contracted with a local internist (who already had his own practice) to help cover the service.

But as an incentive the company agreed to pay this local internist PER PATIENT (just like what any self-employed doc gets). This internist was only too happy to comply. He got to the hospital at 4 or 5 am, saw patients until 10 or 11 am, then went to see his office patients until the late afternoon and then finished up at the hospital in the early evening. Many days he covered the ENTIRE service!

My sources at the company told me that he was taking home an insane amount of pre tax money each month (reportedly he was paid 75% of what Medicare would normally pay per patient per visit). He worked like this for about 6 months until the company was able to hire a third salaried physician. He probably made more in 6 months than he usually does in 12 months or more.

But all was not well even with three full time salaried physicians on the service. As the census continued to go up, physician morale continued to go down. Reportedly they were getting into frequent conflicts with the ER physicians (the source of almost all their admissions) over which patients needed to be admitted and to which service (turf wars). Patients and families started complaining about the service; that the physicians were rushed, that they didn’t take the time to talk to them, etc.

Morale got so bad that the physicians started turning on each other. One decided that he wanted to be on a schedule of 10 days on followed by 4 days off which conflicted with the schedules of the other two. Another physician announced that he was “capping” his service at 20 patients even though this violated his contract and meant that the other two physicians would have to pick up the slack. Eventually and because of these problems the hospital canceled its hospitalist contract with the company and instead . . hired local internists to cover the ER.

Of course this is only one anecdotal example and probably an extreme one of the worst that can happen to a program that is growing too fast, is understaffed, and is probably poorly managed. But there are many other programs out there that have very similar problems of varying degrees of severity.

Before you get suckered into a salaried position like a hospitalist, try to talk in private to some of the other physicians already on staff rather than to the person showing you around. If the current work situation is bad they will usually be truthful with you (and try and get 2 or more private opinions to reduce the likelihood that one of the physicians is the type that hates everything and/or is just having a bad day).