Physician Compensation Models 

Over the years, we have seen physician compensation models lessen in complexity, but that doesn’t mean your healthcare financials will be a walk in the park. With numerous payment structures to choose from, it’s a challenge to align one with your organization.

Where should you even begin? How do you know it’s a good fit?

As one of the most important decisions your medical practice must make, the compensation model you choose directly impacts the financial viability of your business and employee retention. That’s why it’s crucial to have a reliable accounting system in place with a team of industry experts to support your chosen payment framework.

Types of Physician Compensation Models

There has been a push toward more value-based care structures by both physicians and healthcare organizations, and that shift noticeably affects today’s compensation models. Your strategy will determine how your providers are paid and the earning potential of your practice.

To help familiarize yourself with the available options, we’ve put together a few of the most commonly-used physician compensation models.

Straight Salary

With this model, the physician receives a fixed salary that does not fluctuate. They will receive the same amount each pay period in a predictable compensation structure. This model, however, is neither reliant on productivity nor financially incentivizes physicians to boost productivity.

Salary Plus Incentive

In this model, there is an agreed-upon base salary that is always guaranteed. This differs from a complete salary model by adding an incentive program on top of that for the physician to supplement their pay based on productivity, quality of work, and other performance metrics.

Equal Shares

As a simple model to implement, equal shares motivate physicians to become more invested in the growth of the practice and its continued success. This model first deducts the expenses of the practice from its revenue, then splits the remaining revenue among its clinicians.


Each physician is accountable for his or her own productivity metrics in this model, and that will determine their financial payout. This model is often more complicated to track because productivity uses a resource-based relative value scale (RBRVS), but is often favorable for your bottom line.

Streamlining Financials for Multidimensional Health Systems

After reviewing a few of the popular physician compensation models, you can see that your expenses aren’t as straightforward to calculate, which adds another level of complexity to your accounting.

As you evaluate your options to select the best plan for your health system, consider implementing a more flexible accounting platform that will meet your growing complex needs by streamlining your financials, boosting efficiencies with powerful automation, and providing true, on-demand access to your data, all in one place.

Establish Your Compensation Model with Help From Lescault and Walderman

At Lescault and Walderman, we help to integrate all of your financial systems into one unified solution. Using Sage Intacct, the leading accounting and financial management software available for healthcare organizations, you’ll be able to expand and pivot your business, streamline quarterly compensation calculations for better accuracy and more control over your expenses, and improve your daily operational workflows.

We will help you analyze the financial health of your practice and establish the compensation model that best fits your individual needs. Contact us to set up your free discovery call and learn more about outsourcing your accounting.

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