Q: So I looked at your plan; why should providers be on salary?
October 28, 2015
"So I looked at your plan; why should providers be on salary?" This was a question posed by an anonymous person in a forum I chat on. They had really great manners (which seems more and more rare these days).
When I thought about how to support and incentivize a provider to go into the field of medicine, I looked at my own behaviors.
When I was fully salaried and making above 200K, I was perfectly fine with waste. Even though I was the most productive physician in my group, I gladly took long lunches when I had holes in my schedule. After all, I had no personal skin in the game per se.
When I thought about going full-time private practice, I was excited about the huge sums of money I could make, since I average between 150 and 300 bucks an hour. But the stress of running a business and marketing are extreme, and you're never truly off work when you're in private practice. As a result, your adrenaline and cortisol (stress hormones) are high all the time, and you end up a nervous hyper-aroused wreck of a person who's not fun to be around.
So can we get the best of both worlds? Can we create a system where physicians can work their ass off and make a ton of money but can equally support themselves for more thoughtful deliberate work? Yes.
How? By looking at your pancreas.
Let me explain.
Your pancreas releases a constant level of insulin to keep your body working; insulin keeps sugar from building up in your vessels and instead drives sugar into your cells to be burned up for energy. This is called your basal rate. When you eat (i.e. inject a ton of sugar into your blood vessels), your pancreas compensates by squirting a bigger jet of insulin to deal with that sugar. This is called a bolus. Type 1 diabetics should know this concept well.
So to have an ideal setup for medical providers to want to go into the field (because remember that smart, compassionate folks have a choice of how to make money, and we need to be able to recruit them into medicine rather than other fields), they need a "basal" amount of money (support) and the ability to "bolus" as much as they want (incentive) by working harder, seeing more patients, etc.
This approach – I call it the Pancreas Principle – also directly addresses provider burnout, especially physicians. Having to work a solid and busy 20 hours a week to justify your "basal" salary but then being compensated fairly for any "bolus" work above the 20 hours (seeing patients, supervising NPs and PAs, teaching students, writing policy, etc.) means that you have happier doctors with a better work-life balance.
The basal salary would be set by the elected boards of each state's general health fund. The board could increase the basal salary each year to keep their state competitive compared to other states, so that they don't lose providers. The beauty of the universal medical record, however, is that even if a provider leaves one state, they'll have the same access to the system in their new place. Continuity of care. Continuity of information. Cost effectiveness and quality created by market competition.
I would apply the Pancreas Principle to all providers in P.S.Y.C.H.: physicians, physician assistants, nurse practitioners, psychologists, therapists, licensed counselors, optometrists, dentists, occupational therapists, audiologists, chiropractors, midwives, etc. Yes, it would take time to figure out a median basal salary for each, but it's not impossible. And we'll know if providers are "meeting their basal targets" because you'll be able to count the number of encounters they have in the universal medical record (yay for accountability).
Thus we kill multiple birds with one stone: hold providers accountable; pay them fairly; restore work-life balance; incentivize those who want to make more.