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Will Latham, MBA

Inside information for anesthesiologists and Certified Registered Nurse Anesthetists (CRNAs) on the most current best practices during changing times.

Motivating Your Group to Deliver Value: Incentives That Work

Will Latham, MBA
President, Latham Consulting Group, Inc., Chattanooga, TN

There is a lot of talk in anesthesia and all of medicine and healthcare today about providing value.

These discussions primarily focus on providing value to important constituents (such as a hospital) so that the anesthesia group can continue to work with the institution. But anesthesia groups work with a variety of stakeholders, and each of these stakeholders has different needs and, therefore, a different measure of value.

Patients are looking for:

-Excellent quality care

-Effective communication

Hospitals want:

-Excellent quality care

-No problems

-Physician participation on hospital committees, programs and initiatives

-Cost savings

Payers want:

-Excellent quality care (at least they say they do)

-Low cost

And the anesthesia group itself wants value from group members to support efforts to meet the needs of the stakeholders above and the needs of the group itself.

Motivating Group Members

One would think that anesthesiologists would have a natural motivation to continually look for ways to provide value to these stakeholders. However, many anesthesiologists believe that as long as they provide excellent quality care, all the other considerations are irrelevant.

In fact, becoming an owner in a private anesthesia practice requires the following:

-Show up and do the work for several years (pay your dues).

-Don't hurt anyone (provide good clinical care).

-Don't tick off any of the shareholders (make them like you).

In most anesthesia groups, once a shareholder track group does these things, they become owners/shareholders with no further expectations. This stands in stark contrast to other professions, in which those given a vote must show, in advance, that they:

-Bring something special to the organization, beyond technical ability (such as special expertise, being a "rainmaker," strong leadership skills, or other special skills).

-Do work beyond the professional/ technical work to grow and develop the organization.

-Are willing to adopt and adhere to the group's normative behaviors, primarily regarding governance. Normative behaviors are the traditions, behavioral standards and unwritten (or written) rules that govern how a group functions.

Given the fact that, in many cases, anesthesia group shareholders have limited expectations to do anything (other than provide clinical care), anesthesia group leaders need to look at various ways to motivate group members to focus on and provide the value that stakeholders demand.

So how do you motivate physicians? What incentives have a better chance of working?

Studies have shown that there is probably no such thing as a universal motivator. Some are motivated by money, whereas others are motivated by time off, recognition or other factors.

In his excellent book, Leading Leaders, Jeswald Salacuse points out that physicians are what he calls "elites." Elites are individuals who have brains, talent, wealth, power and many options. He notes that "motivating them [the elites] is a lot like shopping for the person who has everything." In fact, he points out that different people have different motivations, and therefore, group leaders need to figure out what those motivations are. This means that group leaders have to get to know their members very well, a process that usually requires one-on-one interaction, in order to target the right incentives for the individual. It's not a one-size-fits-all proposition.


So what incentives should be considered to help motivate anesthesiologists to provide value?

Many people start with money, thinking that it is the only way to motivate people. There are two key problems with believing that money is the end-all-be-all:

1. If money is the only incentive you use, people will only do the things that generate money. Anesthe-siologists often see this in their compensation system. We have seen many situations where the physicians only do the things that directly generate dollars for themselves, whether that means covering their assigned shifts so that they receive their portion of the equal share compensation, or only doing the things that generate "points" under their productivity system. In these circumstances, other extremely important tasks (such as governance activities) are left to those who understand that the stakeholders want more value than just the clinical services.

2. We are living in a world where economic pressures are such that everyone has to do more with less. Often, a pool of money can't be drawn up to motivate every type of desired behavior.

Engage Group Members

So what are some options to incentivize anesthesiologists? Here are a few ideas.

An unstated thought of many physicians is "How good can an idea be if I haven't been a part of developing it?"

If physicians don't have input into how the practice is governed or the plans for the future, they don't have much of an incentive to follow the leadership or implement the plans. This is why group leaders need to find ways to include group members in practice governance activities.

One way is to bring group members together for strategic planning sessions where the membership discusses and debates the group's mission (what we are about as an organization), values (what is important to us) and vision (where we are heading as a group).

Another way to engage group members is with the effective use of committees. The group should identify the needed committees and then give them important work to do. This "shares the load" and helps the group members feel more involved and informed. But to be successful, the board should:

1. Create a charter that outlines the committee's job and work plan for the coming year.

2. Have the committee work on an issue before the board considers it in detail.

3. Make every effort to accept the committee's recommendation. Why? If the board always rejects the committee's recommendations or re-does the work, the committee will reach the conclusion that their thoughts are not being considered and stop doing the work.

Support Group Leaders

Every group needs individuals who will step up and perform important leadership tasks for the organization. This work can include:

-Directing group governance activities

-Dealing with external third parties, such as the hospital and payers

-Operational activities, such as recruitment and scheduling

-Dealing with disruptive physician behavior

These leaders definitely need administrative time to perform these functions. It is unreasonable to expect them to sacrifice their personal time year after year for the group's benefit.

Further, it is unlikely that all the work required of these individuals can be done during the work day. Much of it must be done after hours. Therefore, many groups do carve out monies to be used as stipends for this leadership work.

Over the years, we have heard all the arguments against the practice of paying leaders. These arguments include:

-"We should all share the administrative work equally."

-"This administrative work is not needed. The only important work is the clinical care. The rest of the world will take care of us."

-"The leaders will do it for free. See, they already are."

-"The leaders also benefit from the work they do."

-"We don't want to pay very much or people will do it only for the money."

-"If we pay for one thing, we will have to pay for all things."

These are all smokescreens that individuals use to get the milk for free.

Establish Normative Behaviors

What do normative behaviors have to do with incentives and motivation? If disruptive behavior in a group is not addressed, it can demoralize group members and create a disincentive for improving the practice and providing value.

Normative behaviors should not be overlooked. In 2012, Google embarked on an initiative, code-named Project Aristotle, to study Google's teams and figure out why some worked well and others did not. They looked at 180 teams across the company. The researchers found that what distinguished good teams from dysfunctional groups was how the teammates treated each other. They found that the right normative behaviors raised a group's collective intelligence, whereas the wrong normative behaviors impeded a team, even if the individual members were exceptionally bright.

This is why more groups are developing a written Code of Conduct and a system to deal with those who do not meet group standards of behavior.

As noted in an earlier Communiqué article ("Disrupting the Disruptive Physician," winter 2018), a Code of Conduct is the agreed upon standards of behavior among group members. It sets out, in general terms, the reasonable standards and duties for the group's professionals. It is a sort of "rules of the game" for the organization.

Anesthesia groups create a Code of Conduct for the following reasons:

-As a vehicle to communicate what the group considers important about physician behavior and conduct.
-To improve the group's chances of continuing to have the freedom to govern itself.
-As a method to hold errant physicians in check without making them feel they are under personal attack.
-As a vehicle to remove personalities and private opinions if it becomes necessary to intervene.

What should be considered in a Code of Conduct? Medical groups tend to focus on answering the following questions:

1. What behaviors do we expect of each other? What is acceptable to us? What is inappropriate?

2. What are some of the unwritten rules that guide our behavior that that we should write down so they are universally understood?

3. What are each physician's rights and responsibilities?


Group leaders must act in an intentional manner to recognize individuals in the group who have provided important service, especially those who have made significant sacrifices. This means that recognition should be included periodically in board meetings.

But the leadership should not forget those who sacrifice by doing extra clinical work so that group leaders can attend meetings with external third parties during the clinical day. A formal thank you (at a group meeting or with a note) for such service goes a long way. Some groups send thank you notes with a small gift certificate. This doesn't fully compensate for the time, but it does show appreciation for the sacrifice.

Other Incentives

Many other incentives can be used to motivate individuals. Examples include:

-Using time off/vacation as a reward for exceptional performance or exceptional sacrifice.
-Supporting additional, specialized training with time and expense reimbursement. Several groups we know of provide time and expense reimbursement for future group leaders to attend a Master of Business Administration program.

To sum up:

1. Anesthesia group stakeholders require value, and the value expected goes beyond providing excellent clinical care.

2. Group members will often need to be motivated to provide value. Providing this motivation requires using targeted incentives.

3. While economic incentives can be part of the plan, over-reliance on money can create problems.

4. Other incentives should be a part of the leader's toolbox.

5. Leaders must do the tough work of understanding which incentives will motivate an individual member.