New governance model offers financial incentives

Rewards will be tied to team goals

When reorganization eliminated most of the supervisory positions at Memorial Hospital in Gulfport, MS, it also changed the employee review process. Instead of being evaluated by their supervisors, staff are evaluated by their peers on the treatment team.

Peer evaluation is part of a performance management system designed to reinforce teamwork, says Karen Clarke, RN, MSN, rehabilitation services division manager.

The performance management system, which is expected to be in place by the beginning of the hospital’s fiscal year in October, has three parts: a market adjustment of salaries to put Memorial’s salaries in line with those being paid by other providers in the area; a peer evaluation process that determines an employee’s eligibility for merit raises, and an incentive system that provides financial rewards for all members of a treatment team if they team meets certain goals. Here is how the peer evaluation process works:

Each staff member gets an evaluation form to fill out. Each member of the treatment team on which the employee works also fills out an evaluation, rating that person’s performance on issues such as flexibility and teamwork, says Deborah Woods, RN, MSN, CCM, inpatient rehab team facilitator.

Members of a staff member’s discipline fill out a rating form on discipline-specific issues. The facilitators coordinate the process, compile the scores on each part of the form, and review the evaluations with each staff member. (For more details on the facilitators’ roles, see story, p. 121.) The peer evaluations are used to determine an employee’s eligibility for merit increases, Woods says.

Salary plus incentive

When the incentive system is finished, each staff member will receive a base salary, plus an incentive if the team meets its goals. Among the goals being discussed are patient satisfaction, cost, and outcomes targets.

"We are walking out of an old historical human resources evaluation system where you are encouraged to be here from birth to death. This encourages deadwood because every year people get merit increases just for staying on the job," Clarke says.

The teams will be expected to identify what the targets need to be and to work with management to determine what key success factors are needed to make the hospital successful. That is the philosophy of the systems governance model Memorial Hospital is adopting. "If we are incentivized to work together as a team, we will be stronger."

Clarke believes an incentive will prompt staff to communicate honestly with their peers about their expectations. "If someone isn’t quite up to snuff, it’s difficult to go out on a limb and say so because you have to work with the person every day. But this mechanism allows the team to take a proactive stance and point out things that affect outcomes or patient satisfaction," Clarke explains.

The incentive has not yet been chosen, but she expects it will be some type of monetary reward. "It’s hard for me, too, because, as a division manager, I have to do the same with my peers, and my incentive will be based on how well we work together as a team."