6 Steps to Build a Compensation Plan for Surgery Center Employees
1. Determine whether you need a compensation review. If your surgery center has never performed a compensation review, you should do one this year, Mr. Merski says. You may also need to perform a compensation review if you notice indicators of dissatisfaction, such as high employee turnover, complaints about salary at your annual employee reviews or comments from the staff that similar positions at other facilities are better-paid.
"Generally the question comes up because when you do exit interviews, staff members say they're leaving for a job that pays more," he says. Once you have identified a problem with your compensation, you can start talking to employees to determine where you fall short.
2. Conduct a formal survey about compensation at your center. Mr. Merski says the ASC should conduct an employee survey that determines the strengths and weaknesses of your compensation plan. For example, perhaps some employees feel fairly compensated, and others don't. Perhaps your salaries are on target, but your benefit plan is meager compared to the local hospital. When employees have completed the survey, go over their answers and identify common themes so you understand the most prevalent areas of dissatisfaction.
3. Analyze 10 factors for every job in your ASC. Mr. Merski says ASC leadership should go through every position at the surgery center and discuss 10 factors that are integral to the development of a compensation plan for each position. These are:
1. Educational requirements: What level of education do you require for the position?
2. Job-related experience, in years: How many years of experience are you looking for, at minimum? How many years of experience would the ideal candidate have?
3. Supervision required for the job: How much supervision does the employee need to perform his or her job?
4. Complexity of the job: How difficult is the job, and how many different tasks does it involve? How complicated is each task?
5. Physical effort required: Does the job require physical effort that can leave employees tired or strained?
6. Physical work environment: Does the job involve a hazardous or unpleasant work environment?
7. Potential impact of the employee's actions on the company: How much does the employee affect the financial and operational health of the ASC with his or her actions? What would happen if he or she made a mistake?
8. Internal contacts: Who does the employee talk with internally? For example, conversations between employees in the hall would demand less compensation than regular meetings with ASC leadership.
9. External contacts: Who does the employee talk with externally? Positions involving patient contact would receive more compensation than office staff who do not talk to customers.
10. Supervision over others: How many subordinates does the employee have, and what degree of supervision do they exercise?
Mr. Merski says these 10 components are used nationwide in the analysis of any compensation plan. "If you don't have these 10 components inside the formula you use, you are probably missing the mark," he says. Go over each component with ASC leadership and determine how much weight each component should carry when deciding compensation.
4. Interview employees and supervisors about the requirements for each job. While you should start by identifying the components of each position yourself, you should also ask for employee input, Mr. Merski says. "When you go to evaluate these 10 characteristics, you should provide employees with a position information questionnaire that asks them how many years of experience they need to do the job," he says.
Ask the employee to go through each component of the position and explain what they think is necessary to perform the job sufficiently. When you have collected feedback from employees, give the same survey to the employees' direct supervisors and then finally to the management team. "Once you've done all that, you have [gathered] a full, 360-degree view, from the bottom up and the top down," he says. You may discover that you have been hiring nurses with 10 years experience when two years are sufficient, meaning you could be paying your employees significantly less.
5. Triangulate job details with compensation at like entities, cost-of-living expenses and geographical influences. Once you have determined the traits of each position in your ASC, you should triangulate the internal job description with external factors. This would include cost-of-living, meaning the amount employees must spend to live comfortably in your area. Areas with a higher cost-of-living, such as big cities, will need to compensate employees more highly than areas with a lower cost-of-living, such as small, rural towns. You should also look at like entities — both healthcare facilities and non-healthcare facilities. For example, if your ASC staffs a secretary at the front desk, you should look into how much that secretary could make at a hospital as well as at an insurance firm. "The secretary still does the same kind of work at an insurance company, and they might leave to go there if they're getting paid more," Mr. Merski says.
He says geographical influences also play a role. By looking at compensation data from organizations such as the ASC Association and VMG Health, you can determine how much the average nurse makes in the western United States compared to the southeast, for example.
6. Review compensation annually. Every year, your ASC should look at the external factors that impact compensation and shift the entire compensation scale slightly, Mr. Merski says. The scale will often shift up because cost-of-living has increased, meaning every employee will make slightly more than they did the year before. For individual employees, go through the 10 components of their job every year and determine whether any of the components has changed.
For example, if an employee used to supervise one person and now supervises three, he or she probably deserves a pay raise. If an employee has gained certification necessary for his or her position, that might deserve a pay raise as well. Just make sure that your pay raises are based on tangible changes in these 10 components, rather than a feeling on the part of the administration that an employee is performing well. Mr. Merski adds that every ASC position should undergo a complete review every 5-6 years to determine whether the key responsibilities of the role have changed.
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The Company Model of Anesthesia Services: Will Less Money Lead to Jail Time?
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