Where some COOs, CFOs are passing the baton

Nearly a quarter of health systems are appointing new executives to lead provider compensation — a function previously headed by COOs and CFOs, according to a recent report shared with Becker's

That stat comes from the American Association of Provider Compensation Professionals, which recently surveyed 75 U.S. health systems and medical groups to learn more about their management methods. 

Health systems have been expanding their provider networks since the late 2000s and are continuing to work toward alignment, according to the report. Previously, COOs and CFOs might have led provider compensation strategy — but the arena has grown too complex and calls for an executive presence of its own. 

As such, a number of roles specific to provider compensation have emerged, from the executive director level up to the senior vice presidency. Nearly 25% of health systems surveyed have created a new executive position to develop and lead a provider compensation department; 93% of these departments have sole responsibility for their organization's compensation design and 84% have full control of compensation strategy, from management of fair market value to contract management. 

"The core function of this new resource, department, and team was to build and manage compensation models developed for physicians. For many organizations, this expanded to include advanced practice providers," the report says. "Over the years, organizations have understood the role to be much more strategic than initially proposed, which is why organizations across the country have developed roles [specific to provider compensation]."

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