Ninety percent of hospitals and health systems are either leaving 2012 salary increase budgets unchanged from 2011 or increasing budgets from 2011, according to a new survey from consulting firm Integrated Healthcare Strategies (IHS).
In its “Spring 2012 Salary Increase, Incentive, and Benefit Updates Survey,” IHS found that salary increases for executives, middle management and staff-level employees continue to be at levels below historical trends.
The firm began tracking salary trends because of the poor economy.
“At the start of the unstable conditions in the US economy, Integrated Healthcare Strategies began monitoring trends in healthcare salary increases, incentive practices and benefit changes,” said Kevin Talbot, executive vice president and leader of the Executive Compensation and Governance service line of Integrated Healthcare Strategies. “This sixth survey in the series examines the last quarter of 2011 and into the first quarter of 2012.”
This year’s survey found that budgeted salary increases are slightly higher than the levels reported in earlier surveys conducted by the firm. The median budgeted salary increase for 2012 is 2.5 percent for executives, 2.8 percent for middle management and 2.6 percent for staff.
Organizations reported that they were able to follow through and provide the increases they had budgeted in 2011. This survey showed that actual increases were on par with budgeted increases in 2011.
“We expect these numbers to continue to increase at a conservative pace through 2012,” said Talbot.
In the area of executive incentive plans, nearly three quarters of respondents reported having incentive plans for their executives. Approximately one quarter said they would be making changes to their plans in the coming year. Of that same group, 90 percent will pay awards based on performance in 2011. Almost 40 percent said they will pay incentive awards at or near target.
Given the market’s interest in enhancing physician alignment, the IHS expanded the Spring 2012 survey to measure the prevalence of physician alignment goals in executive incentive plans. Data revealed 37.8 percent of the respondents are using some kind of physician alignment criteria in their incentive plans. The most popular of these goals is “meeting CMS quality standards.” The next two most common criteria are “physician use of electronic patient records” and “readmission rates.”
The Spring 2012 survey is the first of the series to research ICD-10 and its affect on staffing changes for coders. Nearly 60 percent of respondents reported that they anticipate some type of staffing change. Of those, 53.6 percent are expecting to hire more coders, another 23.2 percent are anticipating more coder turnover, and another 23.2 percent are anticipating other changes such as implementing more training programs.