Billions in incentives wasted


More than $20 billion a year is being misspent on incentive programs in which providers do not realize that they are getting an incentive or know how to distinguish between an incentive and regular pay, according to a survey by the consulting company ZS Associates.

“Many health care organizations — hospitals, group practices, and insurance companies — are missing a huge opportunity,” says Torsten Bernewitz, managing principal for the health care insurance and payers practice at ZS and one of the report’s authors. “They spend big dollars, but get little impact. To reform how health care is delivered and paid for, we must make incentives more meaningful and truly motivating.”

The online survey of 4,500 health care providers, taken between November 2011 and January 2012, finds that even though 85 percent of doctors and nurses earn an incentive, 74 percent are unaware of what the reward is or are unable to distinguish it from it from base pay.

In addition, communication about the incentive programs is so infrequent that meaningful guidance cannot be given.

The report suggests that the incentive payment should be spread out over a year so as keep recipients motivated.

Frequency of communication

Frequency of bonus payment

*Includes both payers and providers who hold executive/management roles and are involved in the design and administration of incentive programs for providers.

Source: “Incentives for Health Professionals,” ZS Associates, May 14, 2012

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to jfedder1@hfhs.org or online at http://p.rfer.us/HENRYFORDlXqAJA

Subscribe to Our Newsletters

Monthly table of contents

Be notified as each issue of Managed Care is available online.

Biweekly newsletter

Recent topics have included:

PTCommunity news

New drug approvals, clinical trials, drug management. Three times per week.