Overview

Compensation Pathway™

Page 2

Actual Production and Compensation Alignment

2

0%

50%

100%

150%

200%

250%

0% 50% 100% 150% 200% 250%

% o

f M

GM

A C

om

p

% of MGMA WRVU's

Low Prod – High Comp

Low Prod – Low Comp High Prod – Low Comp

High Prod – High Comp

Actual

Overall

Alignment

Page 3

LH: Low Production / High Compensation

3

*L

L1 L

L2

H

L

H

H2

H

H1L

H

Com

pe

nsation

Production

• Produce less

• Paid more

2 Risk

1 Profit

4 Risk

4 Profit

6 Risk

5 Profit

5 Risk

6 Profit

3 Risk

3 Profit1 Risk

2 Profit

• Produce even less

• Paid less

• Produce less

• Paid even less

Median Compensation

Med

ian

Pro

du

ctio

n

Low

Low

Hig

h

High

• Produce more

• Paid even more

• Produce even more

• Paid more

• Produce more

• Paid less

2. Higher Producers1. Lower Producers

3. Higher

Paid

4. Lower

Paid

Page 4

HH1: High Production / High Compensation

L

L1 L

L2

H

L

H

H2

H

H1L

H

Com

pe

nsation

Production

• Produce less

• Paid more

2 Risk

1 Profit

4 Risk

4 Profit

6 Risk

5 Profit

5 Risk

6 Profit

3 Risk

3 Profit1 Risk

2 Profit

• Produce even less

• Paid less

• Produce less

• Paid even less

Median Compensation

Med

ian

Pro

du

ctio

n

Low

Low

Hig

h

High

• Produce more

• Paid even more

• Produce even more

• Paid more

• Produce more

• Paid less

2. Higher Producers1. Lower Producers

3. Higher

Paid

4. Lower

Paid

Page 5

HH2: High Production / High Compensation

L

L1 L

L2

H

L

H

H2

H

H1L

H

Com

pe

nsation

Production

• Produce less

• Paid more

2 Risk

1 Profit

4 Risk

4 Profit

6 Risk

5 Profit

5 Risk

6 Profit

3 Risk

3 Profit1 Risk

2 Profit

• Produce even less

• Paid less

• Produce less

• Paid even less

Median Compensation

Med

ian

Pro

du

ctio

n

Low

Low

Hig

h

High

• Produce more

• Paid even more

• Produce even more

• Paid more

• Produce more

• Paid less

2. Higher Producers1. Lower Producers

3. Higher

Paid

4. Lower

Paid

Page 6

HL: High Production / Low Compensation

L

L1 L

L2

H

L

H

H2

H

H1L

H

Com

pe

nsation

Production

• Produce less

• Paid more

2 Risk

1 Profit

4 Risk

4 Profit

6 Risk

5 Profit

5 Risk

6 Profit

3 Risk

3 Profit1 Risk

2 Profit

• Produce even less

• Paid less

• Produce less

• Paid even less

Median Compensation

Med

ian

Pro

du

ctio

n

Low

Low

Hig

h

High

• Produce more

• Paid even more

• Produce even more

• Paid more

• Produce more

• Paid less

2. Higher Producers1. Lower Producers

3. Higher

Paid

4. Lower

Paid

Page 7

LL2: Low Production / Low Compensation

L

L1 L

L2

H

L

H

H2

H

H1L

H

Com

pe

nsation

Production

• Produce less

• Paid more

2 Risk

1 Profit

4 Risk

4 Profit

6 Risk

5 Profit

5 Risk

6 Profit

3 Risk

3 Profit1 Risk

2 Profit

• Produce even less

• Paid less

• Produce less

• Paid even less

Median Compensation

Med

ian

Pro

du

ctio

n

Low

Low

Hig

h

High

• Produce more

• Paid even more

• Produce even more

• Paid more

• Produce more

• Paid less

2. Higher Producers1. Lower Producers

3. Higher

Paid

4. Lower

Paid

Page 8

LL1: Low Production / Low Compensation

L

L1 L

L2

H

L

H

H2

H

H1L

H

Com

pe

nsation

Production

• Produce less

• Paid more

2 Risk

1 Profit

4 Risk

4 Profit

6 Risk

5 Profit

5 Risk

6 Profit

3 Risk

3 Profit1 Risk

2 Profit

• Produce even less

• Paid less

• Produce less

• Paid even less

Median Compensation

Med

ian

Pro

du

ctio

n

Low

Low

Hig

h

High

• Produce more

• Paid even more

• Produce even more

• Paid more

• Produce more

• Paid less

2. Higher Producers1. Lower Producers

3. Higher

Paid

4. Lower

Paid

Page 9

Compensation Pathway™

Compensation Pathway™ (Physician Compensation Modeling) is a real-time compensation

modeling tool that allows healthcare executives to facilitate planning and implementation of

productivity-based compensation plans by specialty.

Comp

% of

Phys WRVUs

% of

Phys

Comp/

WRVU

% of

Phys

High (Above 120% Median) 25 28% 28 32% 21 24%

Normal (80% - 120% of Median) 43 49% 37 42% 55 63%

Low (Below 80% Median) 20 23% 23 26% 12 14%

Total 88 100% 88 100% 88 100%

0%

50%

100%

150%

200%

250%

1 4 7

10

13

16

19

22

25

28

31

34

37

40

43

46

49

52

55

58

61

64

67

70

73

76

79

82

85

88

Comp / WRVU

% of MGMA Median 120% 80%

High21 Phys

Normal55 Phys

Low12 Phys

High21 Phys

Normal55 Phys

Low12 Phys

Comp

% of

Phys WRVUs

% of

Phys

Comp/

WRVU

% of

Phys

High (Above 120% Median) 25 28% 28 32% 21 24%

Normal (80% - 120% of Median) 43 49% 37 42% 55 63%

Low (Below 80% Median) 20 23% 23 26% 12 14%

Total 88 100% 88 100% 88 100%

0%

50%

100%

150%

200%

250%

1 4 7

10

13

16

19

22

25

28

31

34

37

40

43

46

49

52

55

58

61

64

67

70

73

76

79

82

85

88

Comp / WRVU

% of MGMA Median 120% 80%

High21 Phys

Normal55 Phys

Low12 Phys

High21 Phys

Normal55 Phys

Low12 Phys

The compensation model is

built within the context of

the physician’s current

experience. In the example

below, the client’s 88

physicians were analyzed

and compared to

benchmark compensation

per wRVU.

Page 10

Compensation Pathway™

Page 11

Compensation Pathway™ – Unaligned Physicians

Page 12

Compensation Pathway™ – Aligned Physicians

Page 13

Equation

2650 S. Decker Lake Blvd. Ste 122

Salt Lake City, UT. 84119

801.783.4100

www.equationconsulting.com

Contact Information