Greetings from Gettysburg, where we are wrapping up The 2017 OPEN MINDS Executive Leadership Retreat. Each year at the retreat, we release the results of our annual Executive Compensation and Retention Survey. This year’s survey had a few interesting takeaways—fewer executives of specialty provider organizations are planning to leave their organization than in previous years. Of those executives who are planning to leave, over half are retiring. And, the proportion of executives who believe they cannot be replaced for the same salary is on the increase.
One interesting finding is the striking difference in CEO compensation based on organizational size. Our survey found that median CEO salary in specialty provider organizations has increased—in 2009, the median salary was $112,000 and in 2017, it was $125,000. But the median doesn’t tell the whole story, there are large differences in compensation at large and small organizations. In fact, the median salary of CEOs at organizations with revenue under $5 million were less than half that of CEOs at organizations over $50 million.
The implications of this compensation gap? Earlier this week, we discussed the new competition that specialty provider organizations face from vertically integrated health systems and national specialty provider organizations (see Leadership Lesson #1 – Don’t Be Surprised!). Generally, we think of this as competition for consumers and for health plan contracts. But, there is also the competition for talent. It appears that growth and consolidation allows the resulting larger organization to pay more for their executive talent. That increase in pay translates into increased ability to recruit the best talent. In an increasingly complex market, competing for executives with those less common leadership skills is necessary for a successful, sustainable organization.
For more on compensation issues, check out:
- Physician Compensation Up 3.1% In 2016; Median Compensation For Outpatient Psychiatrists Tops $240K
- Median Psychiatrist Compensation $246,500 In 2015, Up 5.9% Over 2014
- Models For Physician Compensation & Productivity Management: How Provider Organizations Are Negotiating Clinical Staff Contracts
- Implementing Performance-Based Compensation – Current Models, Issues & An Approach To Successful Implementation
- How To Negotiate An Executive Compensation Package – Exclusive CEO Session
- 4% Of Physician Compensation In Primary Care Practices In ACOs Is Based On Quality Measures
- Maximizing Your Team’s Performance: A Look At Productivity Management & Performance-Based Compensation Models
To learn more about executive compensation in the specialty provider organization market sector, check out our just-released The OPEN MINDS 2017 Executive Compensation & Retention Survey. This research summary provides a current snapshot of executive compensation and retention issues including:
- Executive compensation by position, organizational revenue, profit status, and market segment
- Executive retention by position, market segment, and profit status
- Executives’ reasons for leaving their organization by position and market segment
- Number of executives who believe they are replaceable at the same pay by position, market, and profit status
- Trends in compensation and retention over the past five years
The survey results are available to all OPEN MINDS Circle Premium-level and Elite-level members here. Not a member of the OPEN MINDS Circle? The full survey results can also be purchased online in our e-store for $495.