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					Pay for Performance

           •
               College
                 of
               Medicine


               Presentation by:

               Charles Paidas, MD, MBA
               Joann Strobbe, MsEd
               Paula Knaus, MA

                            May, 2008
Asset Investment Management System
Purpose:

  To support the College of Medicine Missions and
  Strategic Plan by aligning resources with the primary
  missions and rewarding employees based on their
  performance.

AIMS Council Charge:

• Develop a financial management plan that aligns
  resources with our three missions: teaching, research
  and clinical service.
• Develop a pay for performance plan that links pay to
  performance.
                                                  May , 2008
AIMS Development and Implementation

Phase I – Design and Development – April, 2005 to June, 2006
               AIMS Council
               Vice Deans of Primary Missions

Phase II – Pilot and Refinement – July, 2006 to June, 2008
                 Five Pilot Clinical Departments and School of
                Physical Therapy
                 AIMS Executive Committee
                 Vice Deans of Primary Missions
                 Financial Oversight Committee

Phase III – Implementation and Continuous Enhancement
           July, 2008

                                                            May, 2008
         Pay for Performance Outcomes
•   A Pay for Performance Plan for Ranked Faculty designed to encourage and reward
    excellence by linking performance to pay. The Plan consists of:

     –   College-wide minimum percentages of effort in teaching, research/scholarship,
         service and professional development activities required for each ranked faculty
         member (5-5-3-2)

     –   Guaranteed State funds by July 1, 2010 to recognize 5-5-3-2

           • Assistant Professor - $25,000
           • Associate Professor - $30,000
           • Professor - $35,000

     –   College-wide performance requirements for Basic Science and Clinician ranked
         faculty

     –   Pay Model for calculating the variable (Practice Plan funded) portion of clinician
         faculty pay (no minimum wRVUs)

     –   Pay Model for Department Chairs
                                                                                 May, 2008
Mission Based Management Outcomes
•   Data warehouse, Health Analysis Reporting Tracking (HART)

    -- Central collection of financial, human and space data from 13
       separate systems.
    – Management Reporting Tools (reports and electronic Dashboards)
       providing timely data related to identified metrics related to pay and
       budgeting.


•   Funding allocation model for all source budgeting

     – Template for collecting all funds, regardless of source, that support a
       department
     – Model to distribute expenses and revenues by mission
     – Template for developing all-source budgets for departments

                                                                       May, 2008
      FY07: Employee name
 Compensation Data Last Refreshed: 05/10/08 @ 07:35
                            AM

FADS Salaries Data Last Refreshed: 05/12/08 @ 08:24
      PM

FAIR Data Last Refreshed: 07/13/07 @ 12:00 AM



                                                                                                               H
                                                                                                                   i
                                                                                                                   r
                                                                                                                   e

                                                                                                                   D
                                                                                                                   a
                                                                                             HART Global           t
           Salary Schedule - YTD                      Rank             Subspecialty               Department       e

ASF BASE                           $136,712.63        PROFESSOR        Neonatology           Pediatrics


ASF STIPEND                         $12,083.29
                                                      Tenure Status                   FTE
UCS                                $157,205.71
                                                      NG - Non-tenure Earning Grant   0.22
VA SALARY                                 $0.00       NU - Non-tenure Earning
                                                            UMSA                      0.43
Total Salary:                      $306,001.63

PRACTICE PLAN                                         TS - Tenured State              0.35
    BENEFITS                        $29,987.04

STATE BENEFITS                      $31,585.82


Total Benefits:                     $61,572.86




See Handout
                      Results of AIMS Pilot

•   Finalized Minimum Percentages of Effort: 5-5-3-2
•   Separated Basic Science and Clinician Performance Criteria
•   Stratified Basic Science Performance Criteria Based Upon percent of
    Research Assignment
•   Updated Activity Definitions for Effort Reporting and HART Database
•   Conducted Effort Reporting Workshops
•   Identified Data to be Collected into HART Database
•   Eliminated College-wide Performance Criteria for Clinician ASF Pay in
    Education and Research/Scholarship Activities
•   Developed Clinician Faculty Pay Model Linking ASF Pay to Clinical
    Performance Metrics and R&E Analysis
•   Eliminated Minimum wRVU Requirement
•   Proposed Changes in COM Clinical Compensation Policy
•   Developed Pay Model for Department Chairs



                                                                   May, 2008
         Practice Plan Initiatives to
Increase Revenues and Reduce Overheads

• Placeholder slide for initiatives that are
  underway to reduce overheads, etc.
• Language to be provided by Rick Green
  and other members of the SMT.




                                        May, 2008
    AIMS Pay for Performance Cycle
                     Clinician Faculty
1. Annual Determination of Budgeted Total Salary

  Prior to July 1, the Chair/Division Chief and faculty member
  will meet during the annual evaluation conference to discuss
  and agree upon the BTS for the upcoming fiscal year and
  assignment.

  Chair/Division Chief and faculty member will review
  performance data on the HART Dashboard or from the
  Practice Plan as follows:

                                                      May, 2008
    AIMS Pay for Performance Cycle
Performance Data

•     Revenue and Expense Analysis (R & E Analysis) for
      Individual, Division and Department over the
      previous nine months.

•     wRVUs over the previous nine months and compare
      to most recent UHC Survey for comparable
      discipline.

•     Attainment of TGH Hospital based quality
      performance indicators over the previous nine
      months where applicable.
                                                  May, 2008
       Pay for Performance Cycle
Performance Data, continued
•    Attainment of Practice Plan revenue cycle (i.e. 30
     day service-to-post dates) and clinical quality
     metrics over the previous nine months (effective
     beginning 7/1/08-7/1/09).

•    Attainment of Department/Division metrics over the
     previous nine months.

•    FAR effort reports for the previous Academic year to
     confirm fulfillment of college-wide minimum
     percentages of effort.
                                                   May, 2008
Pay for Performance Cycle



Revenue and Expense
 Analysis Template
    See Handout
                            May, 2008
      Pay for Performance Cycle
2. First Quarter Performance Review

•   After the first quarter R&E Analysis is
    complete, Chairs/Division Chiefs will meet with
    each faculty member to discuss progress in
    meeting performance requirements for ASF
    Pay. The Chair/Division Chief will review
    performance data referenced in 1. above for
    the previous quarter.


                                             May, 2008
      Pay for Performance Cycle
If Individual R&E Analysis indicates insufficient funds
to support the faculty member’s Budgeted Monthly ASF Pay,

• a revenue enhancement plan plus an expense reduction
  plan resulting in a positive R&E balance will be
  developed.
• In addition, if other performance metrics are not met,
  plan will include actions to meet such metrics.



                                               May, 2008
         Pay for Performance Cycle
3.   Mid-Fiscal Year Performance Review and
     Related Adjustments in ASF Pay
After the second quarter R&E Analysis is complete, the monthly ASF Pay is
increased or decreased for the following five months based on the
Individual meeting the metrics identified in 1. above for the previous six
months and on the available funds as reflected on the previous six month
R&E Analysis for the Individual and Division/Department.

If R&E Analysis indicates insufficient funds to support the faculty member’s
Budgeted Monthly ASF Pay, the monthly ASF Pay may be decreased at the
end of the second quarter (February 1) in accordance with the Clinical
Compensation Policy and Department/Division pay policy. If R&E Analysis
indicates that revenues exceed expenses, the monthly ASF Pay may be
increased in accordance with the Clinical Compensation Policy and
Department/Division pay policy for the remainder of the fiscal year as long as
individual revenues continue to exceed expenses.
                                                                      May, 2008
       Translating Performance to Pay
                    Clinician Faculty Example
I. Annual Determination of Budgeted Total Salary (BTS) and Maximum
   Potential Salary (MPS)
       Prior to July 1, the Chair/Division Chief and faculty member will meet to
       discuss BTS and MPS for the upcoming fiscal year. See example below.

       Professor X and his Chair/Division Chief agree that his BTS for the
       upcoming fiscal year will be the 50th %ile of the AAMC salary range for
       his rank and discipline which is $ 240,000.
       Professor X’s Budgeted Total Salary for the fiscal year = $240,000
                 Budgeted University Contracted Salary =          $ 80,000
                 Budgeted VA Pay =                                $ 40,000
                 Budgeted ASF Pay =                               $120,000
                 Budgeted Administrative Stipend(s) =            $        0
       Professor X’s Budgeted Monthly ASF Pay =                  $ 10,000
                                                                         May, 2008
      Translating Performance to Pay
                    Clinician Faculty

2. First Quarter Performance Review – No Change in ASF Pay

  After the first quarter R&E Analysis is complete, Professor X
  and his Chair/Div. Chief will discuss his progress in meeting
  performance requirements for ASF Pay. If his R&E Analysis
  indicates insufficient funds to support his Budgeted Monthly
  ASF Pay, a revenue enhancement plan plus an expense
  reduction plan resulting in a positive R&E balance will be
  developed. Also, if other performance metrics are not met,
  plan will include actions to meet such metrics.
                                                          May, 2008
      Translating Performance to Pay
                   Clinician Faculty
3. Mid-Fiscal-Year Review and Related Adjustments in ASF

  After the second quarter R&E Analysis is complete, Professor
  X’s monthly ASF Pay is increased or decreased for the
  remaining five months of the fiscal year based on his
  attainment of the performance metrics identified in
  II. above and on the available funds as reflected on his R&E
  Analysis and in accordance with the Department/Division ASF
  pay policy. See examples.


                                                         May, 2008
      Translating Performance to Pay
                              Clinician Faculty
Example 1: Professor X generates revenues that exceed his
expenses per R&E Analysis

Depending upon the Division/Department ASF pay policy, Professor X
may receive an increase in his monthly ASF Pay over the following five
months based on 1/5 of the $ amount that his revenues exceed his
expenses.
          Budgeted Monthly ASF Pay = $10,000
          Six Month R&E Analysis = $5,000 positive balance
                          $5,000 ÷ 5 = $1,000
      Adjusted Budgeted Monthly ASF Incentive Pay* = $11,000
Note: Division/Department ASF pay policy may require that individual deficits or positive
balances be shared with other clinician faculty in the Division or Department, resulting in no
mid-year ASF Pay adjustment or an adjustment based on a percentage of deficit or positive
balance.                                                                                   May, 2008
      Translating Performance to Pay
                            Clinician Faculty
Example 2: Professor X generates revenues that do not cover his expenses

Depending upon the Division/Department ASF pay policy, Professor X may
receive a decrease in his monthly ASF Pay over the following five months
based on 1/5 of the $ amount that his revenues are below his expenses.

                     Budgeted Monthly ASF Pay = $10,000
                Six Month R&E Analysis = $5,000 negative balance
                              $5,000 ÷ 5 = $1,000
              Adjusted Budgeted Monthly ASF Incentive Pay = $9,000

Note: Division/Department ASF pay policy may require that individual deficits or positive balances
be shared with other clinician faculty in the Division or Department, resulting in no mid-year ASF
Pay adjustment or an adjustment based on a percentage of deficit or positive balance.
                                                                                        May, 2008
          Pay for Performance Cycle
                          Basic Science Faculty
Prior to July
Meet with Chair to review:
     Annual Financial and Academic Statement
     Progress in meeting AIMS performance expectations
     Annual Salary for upcoming fiscal year
October/November
   College bonuses are recommended to the Dean by the FOC and EMC
   based on previous fiscal year’s performance in Instruction,
   Research/Scholarship and Service
January
Meet with Chair to review:
   Six month Financial and Academic Statement
   Progress in meeting AIMS performance expectations
   Develop action plan to meet performance expectations
June and December
    Research Faculty Salary Enhancement Bonuses
                                                                    May, 2008

				
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