by Christen Hunt and Jennifer Sarno
Clinical Team Insights

With a shortage of roughly 140,000 physicians projected to impact health care in the U.S. by 2033, health system leaders are beginning to consider how much the advanced practice provider (APP) workforce, which includes nurse practitioners and physician assistants, could mitigate this shortage. One thing is for sure, the success of this strategy will rely on organizational structures, processes, and the deeply rooted, physician-centric culture evolving to fully embrace the APP workforce.

Compensation methodology for both physicians and APPs and employment type are two of many key factors which can positively or negatively impact the organization’s culture and successful integration of APPs.

Many health care leaders are unaware of the hidden messages that employment agreement and compensation models send to clinicians. These models have the potential of messaging values and priorities that are contrary to the organizational mission and vision, creating confusion within the health system. It is essential for health systems to review their agreement types and models and consider what message is being sent to their workforce and how it may impact the ability of APPs to function at the top of their scope of practice and for the organization to achieve an inclusive culture with highly satisfied clinicians.

A message of individualism

Several clinician compensation methodologies can promote individualism such as base salary, equal shares, straight productivity, and salary plus productivity. These methodologies set clear expectations for the clinician which is important for role clarity but can promote an organizational message to focus on individual contribution. This messaging can lead to clinician disengagement as the clinician is only focused on their individual job requirements versus organizational goals. This lack of engagement can be evident by lack of organizational committee involvement or initiation of quality improvement. While messaging individualism, competition can occur when clinicians are motivated by individual productivity thus hindering collaboration amongst the team and a team-based approach to delivering care.  

A message of being undervalued

Employing clinicians without a contract or employment at will can send a message they are disposable, easily replaceable, and not valued. A well thought out contract can message an added layer of commitment from the organization to the clinician as well as the clinician to the organization. This commitment is measured by lower turnover rates of the clinicians which supports the organization and community they serve.

Another organizational message of unvalued can occur when physicians are provided an incentive for collaborating with an APP. This practice sends a message throughout the organization that the APPs are not valued as part of the team and viewed as a liability by singling out this profession versus other clinical team members the physician collaborate with or oversee.

A message of teamwork and collaboration

Salary plus team incentive compensation methodology can leverage key productivity and performance metrics to align clinicians with the organizational goals while fostering the team approach to care as well as supporting value-based reimbursement. Motivating the team serves as a mechanism to message organizational values focused on teamwork, cooperation, improving processes, and encouragement of information sharing and communication.


There is not a single “best” compensation methodology or employment type that will benefit all health systems equally because it needs to be tailored to the organizational needs, goals, and vision. Vizient Clinical Team Insights can provide some recommendations that all organizations should utilize.

1.    Examine the current organizational APP and physician compensation methodologies and employment practices and the messages it is sending throughout the health system. Ensure these practices are aligned to the organizational goals and sends a message that matches clinician expectations.

2.    Create and ensure consistency in compensation methodology for all clinicians throughout the health system. Fair and equable pay practices promote organizational alignment.

3.    Revisit compensation methodology frequently. Compensation is a topic that can cause significant anxiety so make small stepwise changes when needed and communicate often the reasoning for the changes connecting back to the organizational goals and values.

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About the authors. Christen Hunt, senior director of Clinical Team Insights, serves as a subject matter expert in clinical workforce optimization while engaging with members to assist them in interpreting and utilizing data to optimize the entire clinical workforce. As a strong advocate of advanced practice, she collaborates with research colleagues across the nation to provide evidence-based solutions addressing difficult questions surrounding advanced practice deployment.

Jennifer Sarno, programmatic advisor director of Clinical Team Insights, uses data-driven performance improvement strategies to optimize the clinical workforce. Jennifer’s experience as an Advanced Practice Provider (APP) lends itself to a well-rounded outlook on effective care teams and safe, high-quality care delivery.

Published: October 7, 2020