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Health systems are grappling with competing priorities, trying to corral costs while still attracting and keeping top executive talent with competitive salary and benefit packages.
Health system boards are not compromising executive pay in their cost-containment efforts, yet that dynamic may slowly be changing as more systems emphasize lofty long-term incentives and rein in base salaries to limit their financial exposure.
“Bigger health systems are putting a premium on growing ambulatory care and more preventive care,” said Steven Sullivan, a managing director at executive compensation consulting firm Pearl Meyer. “Over the last three years, they've established alliances with care providers along the continuum. Now they want to put some metrics in place to see if they are getting better in preventive care.”
Today, success is often measured on systemwide areas rather than individual facilities. Population health management, alignment, integration, quality, and patient safety are high priorities. Health systems and hospitals are becoming increasingly sophisticated in how they track and measure performance and hold leaders accountable for performance objectives.
The market for elite healthcare executives is moving quickly, Pearl Meyer's Sullivan said. Compensation will continue to increase around 6% a year for that diminishing group of individuals, he said.
“The right COO, CEO, and CFO, especially those who work in physician alignment—those people are worth their weight in gold,” Sullivan said.