Immediate

Parkland compensation program provides measurable improvements

DALLAS (Jan. 13, 2010) - The Parkland Health & Hospital System Board of Managers announced today that a program linking portions of senior leaders' salaries to specific performance goals has led to measurable improvements in patient safety, quality and operating performance, such as significantly reduced wait times in the emergency room. "The Board of Managers implemented this program because it puts greater emphasis on performance-based goals and underscores the importance of achieving those successes," said Lauren McDonald, MD, chairman, Parkland Board of Managers. The compensation plan has led to improvements in quality and performance. One of the Board's priorities and therefore a heavily weighted goal in the incentive plan was addressing patient wait times in the Parkland ER. Goals were surpassed and Parkland now rivals even the most efficient ERs. For example at its highest, 17 percent of patients left the ER without being seen by a physician. The stretch goal was to reduce that number to 5 percent. The performance exceeded the stretch goal and patients leaving without being seen was actually 4.5 percent. In the past, some patients waited more than 10 hours to be examined and then discharged from the ER. While the stretch goal was to reduce this wait time to seven hours, the result was a drop in wait times to less than six hours. On average, patients waiting to be admitted to the hospital from the ER waited more than 13 hours for a hospital bed. While the stretch goal was set at 11 hours, the actual wait time was reduced to less than nine hours. "The Board understands that we are accountable to the community and is working to ensure the culture at Parkland is one of high standards, top performance, efficiency and quality patient care," said Dr. McDonald. Under the Executive Incentive Plan, earned incentives are based on a combination of system-wide and individual goals, all of which are objective standards that are tracked and measured. A majority of earned incentives is weighted on system-wide strategic goals that focus on the core areas of quality, financial stewardship, high performance organization and patient flow and throughput. In fiscal year 2009, 28 vice presidents were eligible for incentives that ranged from 15 to 35 percent of individual base compensation. For the president, the plan placed 45 percent of his base salary at risk. For that same fiscal year, the total amount of the performance-based incentives amounted to $1.9 million. Comparative market pay data was analyzed to ensure that compensation was well within the standards of the health care industry. To do this, the Board was assisted by a national independent compensation consulting firm, Sullivan, Cotter and Associates, Inc. The Board was careful to adopt a plan with minimal impact to Parkland's financial standing. Earned incentives are an extremely small portion of the operating budget, less than 0.2 percent of the annual payroll. "The Board of Managers thoroughly and thoughtfully developed this plan because we are committed to setting the standard of excellence at Parkland. We are holding Parkland leaders to a higher standard than ever before and this plan is a way to create a culture of high expectations, accountability and results for better performance," Dr. McDonald said. "And, Parkland is competing with health care providers from around the country for talented leaders with proven track records." As a way to attract and retain skilled leaders, 80 percent of health care organizations have adopted similar programs, according to Sullivan, Cotter and Associates, Inc. "Given the current economy and the financial challenges it poses for health care providers, as well as increasing demands for enhanced quality and access, there are always opportunities for experienced health care executives," said Tim Cotter, Managing Director with Sullivan, Cotter and Associates, Inc.

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For Further Information Contact: Candace White 214.590.8054