Question

Appealing to Self-Interest:

1. Describe briefly the approach that each one of the following institutions took to appeal to physician self-interest: (1-paragraph each)

o Geisinger Health System

o Cleveland Clinic

2. What were the outcomes? (1-paragraph each)

3. Pick one impactful quote that you like to feature at the end of this section that resonates with you.

Appealing to Self-interest ^

Physicians, like everyone else, are motivated by financial incentives and job security. Even if their organization's noble shared purpose resonates deeply with them, they also care intensely about what measures are being used to gauge their performance and how the data are collected and analyzed. This natural self-interest can be channeled to reinforce engagement in a number of ways.

Some organizations make portions of physicians' compensation dependent upon performance. Pennsylvania-based Geisinger Health System, for example, ties 20% of physicians' potential compensation to their performance against certain goals or, in many cases, on how they do as a team. Cardiac surgeons, for example, are rewarded on the basis of how reliably they perform key processes such as screening steps and the prescription of medications to reduce complications after surgery. Meanwhile, endocrinologists at Geisinger are rewarded if control of glucose levels improves for all diabetes patients, not just those they see. These incentives are designed to reward leadership and collaboration and to inspire everyone to engage in enhancing patient care. In these and other areas, Geisinger has seen substantially improved patient outcomes, including fewer rehospitalizations after cardiac surgery and, for patients with diabetes, reductions in vision loss, heart attacks, and stroke.

Other organizations put physicians on straight salary, believing that all financial incentives can have unintended negative consequences and are an invitation to game the system. The Cleveland Clinic's physicians are all salaried, without any performance-based bonus program. Instead of using overt financial incentives, the clinic hires all physicians on one-year renewable contracts, and they undergo detailed annual performance reviews. The physicians see the yearly reviews not just as a chance to receive feedback but also as an opportunity to communicate with hospital leaders about how the organization could improve. Like Geisinger, the clinic has seen marked improvement in quality and in volume of patients.

Either approach can have sustained effectiveness, we find, but only when used to advance goals that are consistent with shared purpose. If physicians believe that a particular management-endorsed behavior or practice will improve patient care, even minimal financial incentives will be enough to help them implement it consistently. If they are uncertain about whether it will actually improve care, even large incentives will produce only marginal success. (See the sidebar "Creating Incentives.")

Answer 1

1.

The approach followed by the Geisinger Health System:

Geisinger health system recognized the importance of performance-based financial incentives in motivating the physicians. Physicians were given 20% (of their decided fixed compensation) as incentives if their performance was above a certain standard. Cardiovascular specialists, for instance, are compensated based on how dependably they performed different key procedures, for example, screening steps and the remedy of medicines to diminish inconveniences after the medical procedure. Meanwhile, endocrinologists there are rewarded if they are able to control the glucose levels of all their patients. These incentives are designed with a major objective of rewarding collaboration and leadership which would eventually lead to enhanced patient care and therefore a positive brand image for the hospital.

The approach followed by Cleveland Clinic:

Cleveland clinic followed a fixed salary approach with no performance incentives for the physicians. The physicians are hired on a one-year contract which promises a fixed salary to them. All the physicians have to undergo an annual performance review wherein their performance throughout the year is being evaluated. During this review, the physicians have the opportunity to bring up issues and suggestions for improvement to the management.

2.

The outcome for the Geisinger Health System:

Geisinger noticed substantially improved patient outcomes, including fewer rehospitalizations after cardiac surgery and, for patients with diabetes, reductions in vision loss, heart attacks, and stroke. The overall brand image for the system increased substantially and the employees were motivated too. These outcomes can be a result of the extrinsic motivation given to all the physicians in the form of extra performance incentives.

The outcome for the Cleveland Clinic:

The outcome observed by Cleveland Clinic was the same as that of the Geisinger Health System as it also witnessed a growth in the number of patients and their satisfaction rates. These outcomes can be a result of the intrinsic motivation within all the physicians working at the Cleveland Clinic. This intrinsic motivation may have arrived due to the shared vision and objectives (physicians and the clinic).

3. "Hire those people who have a vision for themselves and others"