More Measures of Productivity: Hours, Patients, Encounters, and Procedures

Last Updated: Feb 1, 2015

This article explores various other measures of productivity that could be used in a compensation model. These productivity measures are: 
  • Hours worked
  • Number of patients
  • Number of encounters
  • Number of procedures

These examples are more basic than they might be in a true compensation system but demonstrate how different variables can have a significant impact on physician compensation.  

Hours Worked

ours worked is typically defined as time scheduled to see patients in the office. It may also include time regularly scheduled for rounds or surgery at the hospital. Normally, it does not include time spent on other activities such as administrative duties, making patient calls, on-call time, or completing notes in patient charts.

In the following scenario, Drs. Alpha and Bravo work eight hours a day, five days per week for a total of 40 hours. Dr. Charlie works eight hours a day, four days per week for a total of 32 hours. The chart below illustrates how each of the physicians might be compensated using hours worked. Dr. Charlie works 80 percent of the hours worked by Drs. Alpha and Bravo; therefore, his compensation is 80 percent of the other two physicians.
 

 

  Hours Worked
Compensation
Dr. Alpha
 40  $150,000
Dr. Bravo
 40  $150,000
Dr. Charlie
 32  $120,000

 

 
The problem with this measure is that, on its own, there is no true measure of productivity. For example, Drs. Alpha and Bravo work the same number of hours per week. However, Dr. Alpha sees an average of 24 patients per day while Dr. Bravo sees about 14. There is no incentive for Dr. Bravo to be more productive and see more patients. For this reason, time is generally combined with another measure of productivity such as encounters or procedures.  

Number of Patients

Number of patients refers to the size of a physician's patient panel. This is more useful in a highly capitated environment, as the physician with more patients on his or her panel will bring in more capitation revenue regardless of the number of patients actually treated during a period of time.   

Number of Encounters

A patient encounter or visit is defined as the face-to-face interaction spent with an individual patient and includes all documented services provided to the patient during the visit. The number of patient encounters is typically measured using a specific timeframe.

Compensation is shown below for Drs. Alpha, Bravo, and Charlie based on encounters and assuming the total compensation dollars cited earlier of $420,000. Note that Dr. Charlie sees an average of 21 patients per day, four days a week, compared to Dr. Bravo, who sees an average of 14 patients per day, five days a week. 

Dr. Charlie actually earns more working fewer hours than Dr. Bravo using this methodology. This calculation is simplified and assumes that total compensation dollars are allocated based on the number of encounters. Most often, however, compensation based on this type of productivity measure would be allocated from a bonus pool in addition to a base salary. A bonus pool is a pot of funds set aside to divide among those who are eligible to receive a bonus based on specific criteria.
 

 

  # of Patient Visits/Wk
Compensation
Dr. Alpha
 120  $183,942
Dr. Bravo
 70  $107,299
Dr. Charlie
 84  $128,759

 

Number of Procedures

Similar to encounters, the number of procedures may be used as a measure of productivity. Again, this measure is typically combined with a unit of time such as an hour, day, or week. Sometimes number of procedures is measured on a per encounter basis. 

One thing the above measures have in common is that they are generally easy for any practice to track, simplifying the calculation of compensation.
 

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