1. MD Incentive Compensation Alexa B. Kimball, MD, MPH Medical Director, Mass General Physicians Organization

2. 2 MGH 1811 Corporation 2 Massachusetts General Physicians Organization (MGPO) Organization and History Formed in 1994 from 3 existing MGH physician groups. Governed by a Board of Trustees, half of whom are lay members. Includes 2,700+ physicians with clinical appointments, almost all of whom are employed by the MGPO. Formed in 1994 from 3 existing MGH physician groups. Governed by a Board of Trustees, half of whom are lay members. Includes 2,700+ physicians with clinical appointments, almost all of whom are employed by the MGPO.

3. 3 Compensation History  Compensation plans rolled out across departments over past 10 years; most have a productivity component  Quality Incentive Program introduced in 2006  2 Terms per year/3 measures per term  Departments also may have some incentive based plans  Internal Performance Framework introduced as we moved increasingly into risk contract

4. 4 Physician Compensation & Incentives Challenges Change Reducing the relative compensation for clinical productivity to fund other incentives (population management, quality, management of TME, etc.), without reducing professionalism, morale, sense of autonomy/mastery, work ethic. Danger of “Monetization” Protecting the commitment to education and academics. Physician perception The independent contractor The cog in the machine (neither is ideal) Low High Relevance of Incentive to Individual Physician Easy Hard Ability to Measure MGPO Department Center Unit / Practice Individual Doctor Department QI program IPF

5. 5 Overall.  18 th program term, 1,940 eligible clinicians Performance by measure.  Population health management: 99% met the target  Joint Commission training: 98% met the target  Department measures: 29 measures, 91% of MDs met their target Communication.  Results in a personal email, online, and in the June Fruit Street Physician  Payment is in the June paycheck QI Highlights Results for Term 1, 2015 5 *This chart may overstate results for small groups.

6. 6 Internal Performance Framework  Forcefield effect  Strategy  Trend  Quality

7. 7 Not done yet: Taskforce Recommended Principles 2014  General:  Improve clinical care or contribute to mission  Consistent with an ethical framework of practice for physicians  Compensation  Comp plan structures should be transparent, consistent and fair  Chiefs should have some discretion over comp components  Comp plans should be adjustable over time to market forces and support recruitment and retention  Productivity measures  Productivity incentives should be included in most compensation plans  Non-productivity measures  Measurable  Actionable  Adjustable

8. 8 Recommended Implementation Principles  Incentives should be integrated in a manner that…  Improve patient care  Minimizes administrative burden  Leverages MGPO QI program admin structure  Recognizes and supports diversity in compensation plans across and within departments  Ideally adds at-risk compensation while preserving current pay  Maintains compensation levels to recruit and retain world-class physicians  Creates opportunity to phase out historical metrics that may be outmoded