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May 27, 2018

Salary: Docs on the Payroll

The hassles of running a private practice are leading many physicians to go to work on staff at hospitals, which are eager to have more control over costs and resources.

Amy Keller | 5/1/2010

Cost Controllers

Dr. William Rupp
Having doctors employed on salary means “there is no incentive to do more tests or more procedures,” says Dr. William Rupp, CEO of Mayo Clinic Florida.

During the national debate over healthcare reform, Mayo Clinic Florida and Cleveland Clinic were often recognized for their ability to keep costs down while providing excellent care. Both say a key to their ability to control costs is the fact that their physicians are employed directly by the clinics and receive salaries. The system, says Dr. William Rupp, CEO of Mayo Clinic Florida in Jacksonville, keeps the focus on the health of the patient rather than on maximizing the revenue in a given case. “By having our physicians on salary,” says Rupp, “there is no incentive to do more tests or more procedures. It’s just whatever is best for the patient.” Rupp adds that some physicians prefer being able to operate more independently and that Mayo’s approach doesn’t work for everybody. “If there was a perfect compensation system, everybody would use it. This is a system that has worked for us.”

Business of Healthcare

Dr. Cristina Mata Dr. Cristina Mata, an endocrinologist and assistant medical director at Holy Cross Medical Group in Broward County, has been fielding plenty of calls lately from doctors who want to join the hospital’s group practice. She says hospital-based employment of doctors is rising again for several reasons. “The doctors that are coming out now ... they’re not really taught the business of how to run a business or run a medical practice, so they want that security of knowing they’re going to get a paycheck, knowing they’re going to be in compliance, knowing that whatever needs to be done will be taken care of, that they’ll be treated fairly and get a decent salary and be able to pay their bills.” Holy Cross has 635 doctors on staff.

Tags: Healthcare

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