By Elliot N. Dinkin, President/CEO
Cowden Associates, Inc.
Recent economic volatility has taught us several painful lessons regarding the management of costs. One very important component of this equation involves, if not the most vital of our assets, our people. As our economy rebounds, it becomes even more important to manage our people with a comprehensive approach to Total Compensation (base pay, incentive opportunities, health benefits and retirement programs). When faced with difficult decisions, all too often health care organizations focus on one particular facet versus a total analysis. Although this may result in some short-term benefits, it may ultimately impact Total Compensation in a negative manner.
Health care organizations must respond to many challenges while managing Total Compensation programs including:
- Escalating benefits and health care costs
- Financial management constraints
- Distinct benefit needs (executives, physicians, nurses)
- Attraction, retention and engagement of all employees
- Maintaining a competitive total compensation and benefits program
This article focuses on a strategic approach to address people costs by considering each facet of Total Compensation versus making decisions focused only on one area. Health care organizations are now obligated to consider changes in their compensation programs based on several recent trends including:
- Reduced staff
- Commitment to hire non-smokers
- Recent medical students are choosing primary care fields versus specialty fields
- Transition of physicians from private practice to full or part-time employment