HOW ARE PHYSICIAN GROUPS using hospitalist compensation incentives, such as shifts worked, RVUs, patient satisfaction, readmissions, patient experience and citizenship, to reward physician performance? And perhaps just as importantly, how much of physicians’ compensation is at risk for such incentives?
According to conversations with hospitalist leaders, compensation incentives change from year to year based on group and hospital goals—and on how willing doctors in those groups are to put part of their pay at risk.
Data from the 2024 Today’s Hospitalist Compensation & Career Survey show that 42% of hospitalists are paid a combination of salary and incentives. About one-third are paid a straight salary, although that model is more common in academic settings.
Our data also found that on average, hospitalists earn about $43,000 of their pay from bonuses and incentives, or about 14% of their total compensation. Quality measures like patient satisfaction scores and documentation are the most popular types of performance metric used to calculate compensation incentives, but productivity (think shifts worked and RVUs) are also widely in the mix.
We talked to the leaders of four hospitalist groups about how their groups use bonuses and performance to provide compensation incentives. Here’s what they had to say.
TeamHealth West Group: bonus pools
When it comes to compensation incentives for hospitalists, many programs continually tweak their incentives. For the groups within TeamHealth West Group, bonus pools have pieces related to productivity and to citizenship.
“With any money at risk, at least half should be easy to get and a quarter should be a stretch.”
Kimberly Bell, MD, MMM
TeamHealth West Group
Kimberly Bell, MD, MMM, the regional medical director who is based in Tacoma, Wash., says that her groups this year are focused on supporting clinicians to bring their patient experience scores—and their incentive income tied to those scores—up. In each of the three groups she oversees, onsite medical directors are “shadow-rounding” to give clinicians feedback on their bedside manner. While she says that practice has been in place for a while now, “we’re making sure every practice is aware of it and is engaged.”
Dr. Bell notes that in a company the size of TeamHealth, there is site-to-site variation in compensation incentives and payments. “Our incentives and incentive criteria do change from year to year,” she says—and different sites may put a higher percentages of their potential incentive payout at risk.
However, Dr. Bell notes, that there is a company-wide philosophy regarding performance incentives. “The company believes,” she explains, “that with any money at risk, at least half should be easy to get and a quarter should be a stretch.”
Riverside Regional Health System: pay for performance
The hospitalist group at Riverside Regional Health System in Newport News, Va., increased its hospitalists’ base salaries earlier this year. The group also adjusted its performance metrics as part of their compensation incentives.
“We’re focusing on the pay for performance model,” says Hardik Vora, MD, hospital medicine medical director, “aligning ourselves with the hospital and health system on performance metrics that they are being held accountable for by Medicare and private payers.”
“In our next adjustment, I think we’ll see more money going to our performance bucket than to our base.”
Hardik Vora, MD
Riverside Regional Health System
Dr. Vora expects to see increasing percentages of physician pay tied to performance measures. “In our next adjustment,” he said, “I think we’ll see more money going to our performance bucket than to our base.”
The group maintains three tiers of bonus payments—threshold, target and stretch—all pegged to different percentiles of performance:
• Threshold category: Clinicians in this first category are there because they “aren’t doing basic things like answering their CDI queries or completing their charts,” Dr. Vora explains. “That’s the housekeeping stuff that everyone is supposed to do.” Hospitalists who meet these metrics see a bonus that adds up to about 7% of their total compensation.
• Target category: Hospitalists in the target level, by comparison, consistently perform within one standard deviation from the group median—and are up to date with housekeeping items. The bonus for hospitalists in this tier comes to about 10% of their total compensation.
• Stretch category: Hospitalists who qualify for “stretch” bonus payouts typically perform in the top quartile range for most of the individual performance metrics. These hospitalists receive a bonus that comes to about 13% of their annual compensation.
On a bell curve, Dr. Vora adds that both the hospitalists in either the threshold or stretch tier would make up only about 10% or 15% of group members. The vast majority of hospitalists receive bonuses in the target category.
“If I have more than 10% of my group in the threshold category, I have a problem,” he says. By the same token, “if 50% of your group qualifies for the stretch bonus, it’s really not a stretch.”
Dr. Vora also notes that while his group does include productivity in its performance metrics, “we don’t have a whole lot of compensation tied to productivity.” While RVUs are one metric in the bonus pool, they aren’t heavily weighted and they get diluted with quality metrics including readmissions, patient experience and hospital-acquired conditions.
“Even if you don’t have as many RVUs, you could still come out ahead in overall compensation,” Dr. Vora points out. “Our comp model has been intentionally designed that way. If we have the appropriate staffing model and physicians bill appropriately, we expect them to achieve their work RVU target.”
Crouse Hospital: productivity incentives per diem
At Crouse Hospital in Syracuse, N.Y., the hospitalist group doesn’t use any RVU incentive for bonuses. James Leyhane, MD, hospitalist medical director, recalled that when he was working for a previous group, he and his colleagues had an RVU incentive. “Everyone’s length of stay went up,” he says. “We all knew that holding on to patients for another day is the fastest way to increase your RVUs.”
“Most of us are much more in favor of not having money at risk, even if it’s a lower overall amount.”
James Leyhane, MD
Crouse Hospital
Ironically, Dr. Leyhane is now trying to figure out how to boost his group’s productivity incentive—but only for the per-diem physicians who work swing shifts, which handle only admissions.
“Some physicians may admit only four patients over the course of a six-hour shift,” he says, “but others admit six or seven. I’m trying to formulate what that incentive would look like without, obviously, having docs just admit patients and not do a good job.”
But for his other group members, Dr. Leyhane says, “I haven’t found a good way to likewise incentivize the day physicians—who do admitting, rounding and discharges—in a way that works for both the organization and the group.”
In terms of hospitalist incentives, Dr. Leyhane says that while some are based on the overall group’s performance, most are individually based. One incentive, for example, rewards hospitalists who complete 90% of billing queries within 48 hours.
“We also have quality metrics related to heart failure,” Dr. Leyhane says, “but we’ve been at 100% of those for two years straight, so we’re probably going to switch those out.” Replacement metrics might target having physicians complete their online malpractice courses or all their CME on time.
Hospitalists’ base salary at Crouse now makes up more than 90% of their annual compensation. According to Dr. Leyhane, his colleagues aren’t interested in putting more incentive money at risk.
“We have discussions about that,” he explains. “Most of us are much more in favor of not having money at risk, even if it’s a lower overall amount. If I were to say, ‘OK, your bonus will be $20,000 or we could put more at risk for a possible $30,000 payout,’ most of the physicians would take the guaranteed $20,000.”
Kettering Health: bonuses for group performance
In Kettering, Ohio, Ashlee Ames, MD, medical director of the employed hospitalist group that covers three network hospitals within Kettering Health, says that she and her colleagues once had about 6% to 8% of their income at risk in a bonus pool. While that’s a fairly standard percentage, Dr. Ames says that group members were OK putting more potential compensation at risk.
“We are actively discussing putting a little less at risk in 2026.”
Ashlee Ames, MD
Kettering Health
When the group last renegotiated its compensation package several years ago, the hospitalists lobbied to increase the at-risk amount. And “we’re going to take a look at comp next year and have new compensation in place as of January 2026,” she says. “We are actively discussing putting a little less at risk in 2026.”
While doctors all get individualized data on their performance, the groups pay bonuses based on group performance for each of the three campuses. Before covid, Dr. Ames says, doctors routinely hit between 70% and 80% of their quality metrics. During the pandemic, however, that performance tanked to about 40%.
Fortunately, performance is now recovering. “We were struggling with ED throughput issues,” Dr. Ames notes, “but we’re now seeing a more stable nursing workforce on the floors that allows us to have better teamwork and communication.” Quality metrics in the bonus pool include length of stay, observation hours, patient experience, discharge summary completion within 24 hours and responding to coding queries within 72 hours.
As for a productivity bonus, “that’s available in our night team contract,” says Dr. Ames. “Some nocturnists can see a lot more patients in a night than others, so once they hit more than the 75th percentile, they can get a productivity bonus.”
As for new quality incentives she and her group may put in place, “readmissions are probably a big one this year,” Dr. Ames says. “I’d be surprised if in the next two years, we don’t have some sort of incentive at risk for readmissions.”
Related articles:
Hospitalist compensation continues its steady rise, survey shows
Paying hospitalists for experience: a look at retention bonuses
Hospitalist pay incentives: a look at bonuses and risk
Hoping for a big pay raise? This may not be the year
Phyllis Maguire has been Executive Editor of Today’s Hospitalist since 2006. Based in Bucks County, Pa., her health care interests are hospital medicine and long-term care options. She also likes zydeco, hiking, and reading memoirs and romances.
