Health Professions Compensation
This guide brings together all the Resources, Organizations, Funding, Events, and News we've discovered related to Compensation.
Here are some top picks to get you started:
Frequently Requested Information
- Looking for Compensation resources by state?
- Browse some of the most common topics related to Compensation:
Overview
What is compensation?
Compensation includes money and benefits provided by an employer, as opposed to reimbursement which focuses on
money provided through health care insurance. Compensation models may mimic those used by insurers, especially
for physician compensation packages. Compensation packages may include bonuses and a variety of benefits such
as health insurance, retirement benefits, paid time off, and professional development opportunities.
Compensation packages
increasingly include
a combination of the below, for example, a guaranteed salary plus
bonuses for meeting quality and/or productivity goals. Models of compensation include:
- Hourly Salary – Salary is paid based on the number of hours worked and often includes a
higher rate for overtime hours.
Advantages: Allows hospitals more flexibility in staffing based on patient volume. Employees may appreciate
being able to pick up hours and overtime if they want extra income.
Concerns: If business is slow, employees may not get as many hours as they would like, potentially resulting
in turnover. Unbudgeted overtime costs can also hurt the employer.
- Annual Salary - A set amount is agreed upon for a year and paid out in increments.
Often used for administrative positions and some employed models for physicians, physician assistants, and
nurse practitioners.
Advantages: Employees are guaranteed an annual salary and it’s easier for employers to budget. Physicians working
in Patient-Centered Medical Homes with an annual salary can spend more time with patients and can respond to
e-mails and phone calls without worrying about for which services they are being paid.
Concerns: Payment structure does not reward additional time and effort given by employees.
- Other Compensation Models - Fee-for-service,
bundled payment models,
and performance assessment-based payment models (such as
pay-for-performance)
are increasingly combined as part of physician
compensation packages.
For example, physicians may earn a guaranteed salary plus bonuses for meeting quality and productivity goals.
According to a 2008 survey of physicians,
the most common compensation method is performance-adjusted salary. Adjustments may relate to productivity,
quality measures, practice profiling, or practice financial performance.
For information on Medicare and Medicaid reimbursement, see our
Medicare and Medicaid introduction.
What factors do employers consider when offering a compensation package?
- Market - Availability of health care providers, demand for services, what comparable facilities
are offering, and trends affecting these. For example,
employers have been offering
higher salaries or additional benefits to attract primary care physicians as demand for them increases
due to trends like newer models of care. See our
supply and demand introduction for
additional information.
- Location - Employers generally consider cost of living and whether amenities near their health
care facility help attract candidates. Rural and underserved areas may qualify for state and/or federal programs
like the National Health Service Corps,
which offers scholarships and student loan repayment in return for service in communities with limited access to
health care. Rural and underserved areas may also offer enhanced benefit packages to make their location more
desirable.
- Profitability of position -
Health care providers such as physicians, physician assistants, nurse practitioners, and others like physical
therapists bring in direct revenue by providing services that can be reimbursed, for example, through health
insurance policies. Other health care positions such as registered nurses indirectly depend upon those health
care providers for funding.
- Position requirements - Experience, certifications, and education requirements can add
value and generally higher salaries as employers try to attract candidates who meet these qualifications.
What kinds of benefits and incentives can be included to make compensation packages desirable to potential employees?
Added benefits and incentives can help organizations with market competitive salaries, but not top-paying
salaries, recruit and retain employees. These may include:
- Insurance benefits for individual or individual plus dependent/s
- Health insurance
- Dental insurance
- Vision insurance
- Life insurance
- Professional benefits
- Coverage of malpractice insurance
- Payment for licensure fees
- Payment for association dues
- Payment for continuing education
- Other benefits
- Retirement packages
- Paid time off
- Sick leave
- Leave for volunteer work
- Sabbaticals for research, education, or mission work
- Bonuses
- Sign-on bonuses
- Retention bonuses
- Bonuses for meeting certain goals
- Other incentives (especially for rural and underserved areas)
- Low-interest home loans
- Relocation expenses
- Practice set-up costs
- Assistance with finding spousal employment
I’m considering a career in health care. How can I find out how much different occupations pay?
Explorehealthcareers.org offers a nice tool for browsing health care careers based on salary, education,
and field: http://explorehealthcareers.org/en/careers/careers.
How can I research what a competitive salary would be for a given health occupation in my region?
Professional, recruitment, consulting, and government organizations often survey health care providers or
employers for compensation information. Participating in these surveys is a good way to gain access to their
results. Research or educational organizations may also survey new graduates regarding starting salaries.
Most freely available resources with health workforce compensation data are listed under
Resources.
Use the “Narrow Results” option on the left to narrow results by a specific profession or location. Recruitment
and professional organizations may charge for wage data and some professional organizations limit access to
compensation information to members only.
Key sources of salary information include the
Occupational Employment Statistics: Wage Data by Occupation
from the Bureau of Labor Statistics (BLS), which provides average salaries by occupation and industry with some
breakdowns by state and metropolitan area. See the BLS article Using OES Occupation Profiles in a Job Search for additional information on how to use their wage data.
Here are some alternative resources that provide national data; some include additional breakdowns:
- Behavioral Health Occupations
- Dental Occupations
- Health Aides, Assistants and Guides
- Nursing Occupations
- Pharmacy Occupations
- Physician Assistants
- Physicians
Where can I find examples of compensation models used to support newer models of care, such as the Patient-Centered Medical Home?
Examples from Gray Literature and Journal Articles
Health Workforce Information Center indexes
journal articles and gray literature. Highlights include:
PubMed indexes many
additional journal articles.
Examples from Government Agencies
Agency for Healthcare Research and Quality (AHRQ) collects examples in its Health Care Innovations Exchange
Centers for Medicaid and Medicare Services (CMS) funds projects related to payment reform
Examples from Foundations
Commonwealth Fund supports programs seeking to improve health care practice and policy
Robert Wood Johnson Foundation supports health care transformation
How does compensation affect the supply of health professions faculty?
Nursing is particularly affected by faculty compensation issues. While medical faculty practice medicine and
teach on the side, in fact many medical faculty are volunteers, fewer nursing faculty do the same. They are
also paid on average fifteen percent less for teaching than they would be for providing patient care, discouraging
nurses from becoming educators. This in turn affects the number of students nursing schools can admit and thus
the supply of nurses. See
“How does educational capacity affect the
supply of health professionals?” on our Supply and Demand introduction for more information.
Source: Ninth Annual Report to the Secretary of the U.S. Department of Health and Human Services and the U.S. Congress: The Impact of the Nursing Faculty Shortage on Nursing Education and Practice, 8/2010
What are some current trends related to health workforce compensation?
- Increase in
quality and productivity-based incentives, particularly to improve patient outcomes and decrease health care costs
- Compensation for
providing distance services and coordinating care
- Enhanced benefit packages
- Higher compensation for primary care providers compared to previous years, due to demand related to new models of care
- Consideration of minimum wage standards for personal care workers
Page last updated April 9, 2013 |
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