Provider Retention Best Practice

Listen to them.

I contemplated just “dropping the mic” and walking away after saying that, but felt compelled to explain.

In the last few months we’ve had numerous calls and emails from both health centers and PCAs looking for help with “creative ways to retain providers,” typically involving either incentives or some other kind of monetary inducement to stay (and preferably to improve productivity, since nothing comes for free).  We’ve also read numerous articles and seen many webinars offered by experts on the subject telling health centers what they need to do (and usually what they need to pay).  Before you worry about being creative, try something basic.

The truth is, the first and most important step toward improved provider retention is listening to them.  Not talking TO them, but LISTENING to them.  Whether you have externally facilitated focus groups or individual conversations, have a monthly CEO lunch or hire a “provider relations specialist,” there is nothing more important toward retention than asking your providers how they feel about their jobs.   We recently held a series of focus groups with providers at a health center contemplating incentives to improve productivity. You may very well hear something about pay, because everyone has something to say about pay, but it’s more likely that you’ll hear the things that we did, like these:

  • My work-life balance is out of whack — I work all day in the clinic and then spend another four hours every night closing my charts.
  • The front desk can’t figure out how to set appointments — I get 15 minutes at the end of the day for a patient that I know needs an hour, or I get a parent who has to bring one kid in at 9 and the other at 3 even though they could both come in at the same time.
  • I’ve had four MAs in the last six months, and the minute I get them halfway trained up they leave.
  • Every time a patient has an issue they go to management who never has my back
  • Decisions on clinical procedures and practices are being made by administrators with no input from clinicians, and the Medical Director isn’t even a part of senior leadership.
  • My pay is a lot lower than the kids you just hired out of residency — I didn’t even care about what I made until I found out about that.
  • I waste a ton of my time on things that can… and should… be done by other people.

Now there will always be exceptions in every organization, but for the most part what we hear is frustration.  Frustration that they can’t get their jobs done.  Sometimes frustration that gets to be far more than the desire to achieve the mission they signed up for.  If you don’t want to believe them, that is, that it isn’t just a matter of throwing money at the problem, go to the Rand Corporation Study on physician work satisfaction.  While money is mentioned, you’ll find many more things to consider when it comes to retention — from your Electronic Medical Records system to your ability to retain front-line staff because you don’t pay enough.  But better yet, take some time out of the day to listen to YOUR providers, because they are the ones you need to retain.



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The Decline and Fall of “Pay for Performance”

Prepared for the NWRPCA Quick Notes, the full text of this important critique of current methods of “pay for performance” appears in Merces’ general industry compensation blog, “The Compensation Times”

The Compensation Times

[This article was originally published for the Northwest Regional Primary Care Association “Quick Notes” and can be found here.]

Congratulations on your new hire. “Ron” looks to be a promising new employee. He came to you with a strong resume and enough relevant experience to suggest that he is the kind of employee you see as a long-term, steady provider. For his part, Ron hopes to enjoy his work, feel acknowledged, and be compensated in line with the value he brings to the company and his growing value in the external marketplace. Compensation isn’t the most important thing for Ron, but his emotional response to his compensation can set the tone on how we sees the organization as a whole.  He needs to know his contribution will be rewarded and be consistent with his performance, that of his colleagues performing at the same or different levels, and fair market…

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FQHC Provider Productivity Lags Expectations

The actual productivity of FQHC family practice physicians averages about 14% less than what is planned for on a daily basis, and about 11% below expectations on an annual basis. While productivity against expectations is somewhat higher in an incentive environment, the average family practice physician participating in an incentive plan still falls 11% and 5% below daily and annual targets, respectively.  While “locum tenens” may fill in some of the gap when providers are not at work, health centers may be experiencing a shortfall of almost 440 patient visits per provider, per year, against their plans.

Merces 2015-2016 FQHC Provider Productivity & Compensation Survey collected data on more than 2,200 medical, dental and mental health providers from 57 health centers across the country.  Conducted in the last six months of 2015, the study gathered information on both expected performance organization-wide and actual performance of individuals. Information on compensation methods and actual pay was collected and analyzed along with daily and annual productivity expectations.

The “average” health center expects a full-time family practice physician to see 18.2 patients per day, and in 214 “full” work days, to see 3,917 patients per year.  As noted above, actual performance is significantly lower — the average family practice physician actually saw only 15.1 patients per day and just 3,192 annually.  The current average annual salary for full-time family practice physicians is just about $178,500; about 93% of W-2 compensation comes from base salary — the remainder is combination of productivity earnings, other bonuses and other forms of “reportable” compensation.

Similar findings appear among most of the fourteen different types of providers (including mid-levels) studied.  A number of factors are considered in the various analyses, including providers’ personal characteristics and the characteristics of the health centers.  As previously reported, health centers appear to be compensating female providers at lower levels than similarly situated (and performing) males.

More information will be provided in the coming days; for information on how to purchase a copy of the report, contact Merces at




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Stop Gender Pay Inequity – Repeal (Part of) the Equal Pay Act

Ironic, isn’t it….

The Compensation Times

Well not all of it, of course.  Most of it, along with the other anti-discrimination laws, are crucial to fighting intentional discrimination.  However, one particularly nagging part of the Equal Pay Act actually enshrines “unintentional” discrimination.  It is all in 29 USC Section 206(d)1, a sentence that starts out really well by banning discrimination, but then gives the following “out”:

…except where such payment is made pursuant to (i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) a differential based on any other factor other than sex.

Here’s the problem, in statutory order:

1.  A (i) seniority system, by definition, pays people based solely on how long they have managed to stay employed.  Seniority systems are inherently discriminatory when any group of people will tend to have less seniority than others, e.g., when women take time out…

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Health Centers Need to Address Provider Gender Pay Inequities

On International Women’s Day, we thought it appropriate to begin the release of information from Merces’ FQHC Provider Productivity and Compensation Survey, the only study of its kind, with data on how female providers’ pay stacks up with their male colleagues.  The average salary for a female physician ($174,048) is approximately 93% of the average salary of a male physician ($187,020).  OB physicians were excluded from these calculations in order to avoid potential distortions of the results, but the result among this specialty is the same, with females at 92% of males.  Similarly, female physician assistants earn 93% of the average salary of their male counterparts (93,235, compared to 99,818). This pattern continues, even after controlling for clinic setting, health center size, and experience.  While there are combinations of factors in which women earn more, they are all those with very small samples.

While the gender pay differential among physicians is not as striking as the 15% pay gap Merces identified among FQHC CEOs earlier this year, it is still troubling, considering that there is only a statistically insignificant gap in productivity between male and female providers, with female physicians having an average of 3,264 patient encounters per year, compared to 3,251 for men.  As expected, this varies, sometimes widely, when accounting for clinic setting, health center size, provider experience and provider specialty, but there are only a few situations where male provider productivity appears even moderately higher than that of similarly situated female providers.

Productivity is, of course, only one of many factors to consider in analyzing pay, but as it has been the measure seemingly at the forefront of discussions of pay, and with a focus on “performance-based” pay programs, Merces reviewed the effectiveness of pay programs in rewarding productivity.  Male and female family practice physicians were placed into three groups in each of two categories — productivity and salary.  The “low” group included those in the lower 25% of each measure; “middle” referred to the middle 50% of the sample; and “high” the highest 25%.   Absent any other factor, we would assume that relatively equal percentages of male and female providers would fall in the nine possible “blocks.”

The distribution of providers by productivity between males and females was as it would be expected — virtually the same.  Controlling for productivity, however, when it came to pay, more male providers fell into the “high salary” category (34%) than women (21%).  Further, despite the similar level of productivity, the “high performing/high salary” group of male providers made up 12.5% of the male providers, four times more than the similar group of females, who made up only 3.7% of the female providers.

Whether by absolute numbers or comparisons of “categories” based on performance and pay, there appears to be a disconnect between male and female provider compensation that should be addressed if health centers truly want to improve their recruitment and retention experiences.

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