Perils of Payment

The complexity around physician compensation demands defined, layered board oversight

By Kim Mobley and Marc Hallee

H ospitals are employing and developing alignment strategies with physicians in a particularly complex regulatory environment. Compliance failures can be costly, with some settlements and court orders regarding noncompliant arrangements totaling millions of dollars. As a result, boards must be able to address the many issues associated with physician compensation and financial arrangements and ensure that processes are in place to support decision-making in a high-risk, complex regulatory environment.

As an example, consider ABC Health, a typical health care system today. ABC Health comprises two hospitals, including trauma services and each with its own medical group; a health plan; an accountable care organization; a skilled nursing home; an orthopedic joint venture; an employed cardiology group; and a primary care network.

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