Ninety percent of hospitals and health systems are leaving 2012 salary increase budgets unchanged from 2011 or increasing those budgets, according to the spring "2012 Salary Increase, Incentive, and Benefit Updates Survey," published by Integrated Healthcare Strategies, a consulting firm, with offices in Kansas City, Minneapolis and Dallas.
Although salary increases for executives, middle management and staff-level employees continue to be at levels below historical trends, the survey found that budgeted salary increases are slightly higher than the levels reported in earlier surveys conducted by the firm. The median budgeted salary increases for 2012 is 2.5 percent for executives, 2.8 percent for middle management and 2.6 percent for staff. Organizations reported that they were able to follow through and provide the increases they had budgeted in 2011. This survey showed that actual increases were on par with budgeted increases in 2011.
“We expect these numbers to continue to increase at a conservative pace through 2012,” said Kevin Talbot, executive vice president and leader of the Executive Compensation and Governance service line of the firm.
In the area of executive incentive plans, results showed of the nearly three-quarters that had incentive plans for their executives, approximately one-quarter said they would be making changes to their plans in the coming year.
Of that same group, 90 percent will pay awards based on performance in 2011. The largest group, almost 40 percent, will pay incentive awards at or near target.
Given the market’s interest in enhancing physician alignment, the firm expanded the spring 2012 survey to measure the prevalence of physician alignment goals in executive incentive plans. Almost 40 percent of the respondents are using some kind of physician alignment criteria in their incentive plans. The most popular of these goals is “Meeting CMS Quality Standards.” The next two most common criteria are “Physician Use of Electronic Patient Records” and “Readmission Rates.”