Want to be paid a straight salary? Here’s how it’s done

By John Murphy, MDLinx
Published November 29, 2018

Key Takeaways

According to results of a 2017 survey, 70% of general physicians and 78% of specialists said they’d rather be paid by straight salary (or paid by salary with a few incentives) than by volume of services. But the straight-salary model doesn’t come without potential downsides, and it won’t be easy for hospitals and practices to transition from paying physicians by fee-for-service to straight salaries.

“The advantage of the straight-salary model is that we can work as a [non-competitive] multidisciplinary team to decide what’s in the best interest of the patient,” said radiologist John Wald, MD, medical director, Public Affairs and Marketing, Mayo Clinic, Rochester, MN. “We’re not as concerned about whether this test or that procedure will be reimbursed.”

But if the Mayo Clinic is any example, providers in other hospitals and practices might also appreciate working in such an environment. Health-care centers that pay their staff members by straight salary include the Cleveland Clinic, in Cleveland, OH, and Kaiser Permanente, in Oakland, CA.

Best interests of the patient

From the survey, researchers predicted that paying physicians by salary rather than by volume of services would lead to fewer tests and procedures, which would lower overall health-care costs—and also reduce physicians’ job frustrations.

“That’s why I got into this profession: To focus on patients, not to worry about the money,” Dr. Wald said in an interview with MDLinx.

Because the straight-salary model doesn’t put a burden on providers to “hit their numbers” on a daily, weekly, or monthly basis, it frees them to concentrate on what’s in the best interest of the patient, according to Dr. Wald. They’re not as busy working toward generating more income and seeing more patients in the day.

That’s not to say that providers who work in fee-for-service locations provide inadequate care or order excessive testing, he added. But the fee-for-service model can take time and emphasis away from focusing squarely on patient-directed care.

In addition, physicians at the Mayo Clinic also have more time to work on research, education, and other professional pursuits, Dr. Wald noted.

There’s another benefit to straight salary, he added. Providing care that puts all the focus on the patient’s best interest attracts the “best and brightest individuals.” And not just the best and brightest physicians, he added, but also outstanding nurses, lab technicians, therapists, administrators, and so on.

What are the downsides?

Dr. Wald doesn’t see many downsides to the straight-salary model, but he recognized that others might have different points of view. For one, physicians who are paid by volume of services may feel they have more autonomy over their income, and working as a salaried employee might take away some of that autonomy.

To that, “I would say that I have a great deal more autonomy because I don’t have the worries about generating—or not generating—my professional income,” Dr. Wald said.

Another potential downside to the straight-salary model is that providers are frequently called on to take an extra patient or perform an additional procedure late into the night, for example, without any additional pay.

“But if I, as a physician, trust and respect the administrators who I work with, and they respect and trust me with the work that I do as a provider, then salary will fall in line. And I’ll have the personal and professional satisfaction that I’ve provided the best care I possibly can to my patients,” Dr. Wald said.

Other health-care centers and practices could move to the salary model, but it would take time to make the transition. “It wouldn’t be like flipping on a light switch,” Dr. Wald said.

Besides time, he added, the main requirements to successfully make such a transition would be that all parties must trust and respect one another.

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