feature
Enhancing Office Productivity With Pay
for Performance
Practice
owners who integrate such employee programs can reap rewards.
JOSEPH CARROLL
As
the medical industry faces greater regulatory and reimbursement scrutiny, today's
retinal practices need more from their employees. However, office managers and physician
owners alike have been unable to answer one basic question: How do we motivate employees
to actually do more?
In Abraham Maslow's book, Motivation and Personality, the
American psychologist explained that people, even as employees, are motivated by
the existence of unsatisfied needs. The existence of these needs motivates employees
to "do more" and "do better." As such, the focus should then be on the planning,
development, and implementation of well-defined personnel evaluation systems that
motivate employees to do more, reward doing better, and make a career out of what
was once considered a job.
|
Figure 1. Insurance Clerk |
|
Entry |
$10.00
- $10.75 |
1 Year
Required |
|
Level Two |
$10.76 - $12.00 |
2 Years Required |
|
Level Three |
$12.01 - $14.00 |
3 Years Required |
|
Level Four |
$14.01 - $16.00 |
4 Years Required |
Unfortunately, for too long, medical practices have focused on
providing employees with the lower-level needs such as "cost-of-living increases."
Throughout 15 years of rigorous consulting, I have yet to find
1 practice that has benefited from giving its employees cost of living increases.
Such increases should, in my opinion, be universally stricken
from use as they are devoid of an effective performance instrument that creates
a "win/win" relationship between the employee and employer. In order to get more
from employees, we must focus on moving them across the hierarchy toward their social,
ego, and self-actualization needs.
Therefore, this article will explain how to motivate employees
as well as provide an outline on setting up a pay-for-performance program.
UNDERSTANDING THEIR ROLES
|
Figure 2. Insurance Clerk:
Level 1 |
|
• Successfully completed the company
orientation program
• Implements company core values successfully
• Policy and procedure manual orientation completed and documented
• OSHA training completed and documented
• HIPAA training completed and documented
• Maintains practice and patient confidentiality
• Must abide by all company rules and regulations
• Answers the phone appropriately by the third ring and according
to company protocol
• Consistently demonstrates a high degree of customer service
• Consistently greets patients in a warm and friendly manner
• Accurately answers all billing questions for the practice
and patients
• Must have general knowledge top 20 CPT and ICD-9 Codes
for ophthalmology
• Must have understanding of ophthalmic terms, procedures,
and testing
• Must be able to properly reconcile each day
• Performs daily back-ups as required by company policies
• Must successfully complete the business office skills assessment
(written and practical) with 95% accuracy or greater |
|
Level 2 |
|
• Completely mastered entry level
• Must be able to handle all mail correspondence from insurance
companies
• Must be able to properly post all charges within 24 hours
• Processes all electronic and paper claims within 24 hours
when properly submitted or corrected
• Ensures all secondary claims are filed within 24 hours
• Ensures all denied claims are properly corrected and resubmitted
within 72 hours
• Processes all patient statements in accordance with practice
protocols
• Ensures all claims that are 35 days old are evaluated and
corrected for errors and re-filed accordingly
• Must be able to completely handle all insurance and patient
bill calls
• Must be completely familiar with the practice computer
software |
|
Level 3 |
|
• Completely mastered level 2
• Must be completely familiar with the insurance appeals
process
• Ensures all fee schedules are current and up to date
• Must be able to properly conduct a chart to superbill audit
• Must be able to properly complete the tracking of all ECP
reports for acceptance or denials
• Ensures patient and insurance refunds are current
• Ensures the aging of accounts receivable are consistent
with ophthalmology standards
• Must have an outstanding knowledge of modifiers
• Maintains rules and regulations for insurance carriers
• Ensures physicians are properly credentialed
• Ensures all patient and insurance refunds are current |
|
Level 4
|
|
• Completely mastered level 3
• Must be able to process all aspects of accounts receivable
• Must be completely familiar with all aspects of ophthalmic
coding
• Must be able to process all requested patient and management
reports
• Must have an above average knowledge of billing and compliance
issues
• Must be able to perform at least 1 other requested practice
job description
• Provide suggestions on how to improve customer service
and efficiency
• Must be able to fill in for the supervisor as needed
• Assumes other duties as assigned without difficulty |
Pay for performance requires full involvement
from owners, management, and employees. After all, the point is to move your employees
out of their comfort zone — a position with which most become apprehensive.
As such, it is incumbent upon the management of the practice to fully involve the
staff, providing them with the rule book for success and asking them ahead of time
if there is any expectation that is unclear. Office administrators need to identify,
both orally and in writing, the expectations for each of the job positions within
the organization. Most of the time, staff members want to do a good job — they
just do not know what is expected of them. Staff members should receive their individual
career ladder and pay grades and sign release statements indicating that they understand
the company's goals of the program. The goal is to manifest a corporate culture
that promotes an ownership mentality at the staff level and rewards accountability.
This straightforward approach will not only pay dividends for the partners of the
practice, but it will also ensure high-quality performance, efficiency, and teamwork.
PROGRAM STRUCTURE
The curriculum of pay for performance is
twofold. The first, the "do better" component, is a bonus program. The second, the
"do more" component, is an annual merit salary adjustment based upon well-defined
levels of responsibility. Both components utilize a career ladder that is used as
the basis for the employee's bonus and annual merit salary adjustment. The inclusion
of both components ensures that employees are not only responsible for mastering
their duties, but that they will take on additional responsibilities as well.
Each career ladder has a specific job description with multiple
levels of expertise, ranging from entry level to level 3 or 4. Each level is accompanied
by a corresponding entry-level pay grade and a maximum hourly rate. Employees' job
performance is evaluated on their career-ladder level, and a score is derived from
the evaluation summary assessment described below.
Based on the assessment score, both the bonus and merit increase
are calculated. As a result, employees will either remain in their current career-ladder
level with identified areas of needed improvement, or if the score reflects that
all job responsibilities were mastered, employees will be moved to the next level
of the career ladder and corresponding pay grade.
The potential bonus amount that we recommend for the staff is
usually 4%. The 4% should be divided equally into two 6-month evaluation periods,
2% for each period. Evaluations should be conducted on the employee's anniversary
date and the subsequent 6-month period following the anniversary month.
This prevents the manager from being overburdened by conducting
numerous evaluations in a short time period. In order to be eligible for the program,
an employee must have been with the organization for 6 months of continuous employment
and must have successfully completed a
3-month initial performance evaluation.
The following steps can help to develop an effective pay-for-performance
program:
■ All partners must be committed. All principals
and partners in practice should realize that a program of this magnitude will be
an investment in their staff. It will enhance the company core values, maximize
customer service, improve productivity, augment skill level, decrease turnover,
enhance morale, and improve the bottom-line financial results of the corporation.
As there will be resistance from some staff members, partners must be consistently
supportive of the program when there is negativity and resistance from staff members
who try to derail the program. Without full partner cooperation and support, the
program cannot be successful.
■ Management support. A variation from the
daily routine can precipitate stress at the management level. Because office managers
will be involved with the implementation of the mechanics of the pay-for-performance
system, they must be in complete support of all aspects of the program. The supervisory
and upper level management staff must be trained in proper human resource compliance
techniques and how to properly conduct a staff review. Compliance with all necessary
issues pertaining to current labor law should be addressed with management. They
will also need to learn how to use the program as an instrument for success, promoting
job enrichment for all.
■ Make a 1-Year commitment. In today's complex
society we have all been programmed for instant gratification. For a pay-for-performance
program to be properly implemented, partners and management will need to be patient
and understand that it will take a minimum of 1 year to be successful. Staying the
course is vital, even if challenges arise.
■ Develop a wage and salary program. Each
position within the practice should be carefully evaluated for duties, roles, responsibilities,
and levels of pay. For the majority of positions within the practice, we recommend
4 levels of pay grades (for a breakdown of the levels and a job example, review
Figure 1). Following a review of current wage and salary benchmarks for the given
marketplace, the pay grades are assigned in ascending increments to the respective
levels of the career ladder. For example, at an entry level position, you will need
to determine what the market requires to hire a person to perform a certain task
at the very basic level with minimum experience for a particular job description.
In return, the entry level position would pay at the 25 percentile of the wage and
salary benchmark, and a level 4 employee should be paid in accordance to the 100
percentile. As a control, we also recommend that each position has requirements
for tenure within each level. Analysis of the pay grades should be conducted annually
to ensure that they are fair and consistent within the demographics of your marketplace.
Data are available through national wage and salary studies conducted for geographical
regions.
■ Develop career ladders. Once the basic
responsibilities and pay requirements of the job description have been determined,
career ladders must be developed for each job classification (front desk receptionist,
technician). This is a critical step within the development of the program.
For each of the levels, well-defined job requirements must be
noted along with any essential skills and abilities that are needed for the position.
Clearly state the requirements of the job at every level and identify the expectations
for success. The expectation is for employees to function at their highest legal
capability in an effort to support, cultivate, and enhance the physician's success
within the practice (Figure 2 is an example of a 4-level career ladder that has
been developed for an insurance clerk).
|
Figure 3 |
• Score of 9.5 to 10.00 = Full bonus
plus 4% increase in pay or move to the lowest level of next career ladder
• Score of 9.0 to 9.4 = 90% of bonus potential plus 3% increase
in pay
• Score of 8.0 to 8.9 = 60% of bonus potential plus 2% increase
in pay
• Score of 7.5 to 7.9 = 25% of bonus potential with no pay
adjustment
• Score Below 7.5 = No bonus or pay adjustment |
■ Create an evaluation summary tool. After
all of the other steps have been completed, an evaluation tool is developed to score
the employee based upon his/her performance. A spreadsheet containing pre-designed
formulas can be used to derive the employee's performance rating from the criteria
listed above. The employee is also rated on overall judgment, productivity, attendance,
punctuality, customer service, demeanor, teamwork, and capabilities as a technical
expert. Once all job criteria are rated, the employee's composite performance evaluation
score is derived and merit pay and bonus increases are determined (an example is
provided in Figure 3).
■ Human resource compliance. It is important
to make sure that practices do not violate any federal or state human resource laws.
We recommend that physicians develop a disclaimer that is published in the employee
handbook identifying the rules and expectations of the program. Office managers
need to document that employees understand the requirements of their jobs and how
they will be paid on their individual and team performance.
In writing, it should be made clear the program may, at the discretion
of management, be modified or cancelled at any time. Within a union environment,
it might be a good idea to review the program structure with a labor attorney prior
to the implementation of the program.
Employees are no different than any other investment for which
you spend time and money in hopes of receiving a return on investment. However,
people need to be motivated in order to produce results. Pay for performance can
motivate employees to do more and reward them for doing better.
Joseph Carroll is founder, president, and CEO
of Advantage Administration, Inc., a full-service medical consulting company.
He can be reached by phone at (866)217-4214 or by e-mail at
jcarroll@advadm.com.
Retinal Physician, Issue: September 2006