Pay for performance improves nurse attendance
Pay for performance improves nurse attendance
(Editor’s note: In last month’s issue of Same-Day Surgery, we offered you winning ideas from a hospital same-day surgery department and a surgery center on how to motivate nurses. In this month’s issue, we profile a pay-for-performance program that ties raises to employee productivity. The hospital has seen a 25% to 30% increase in employee satisfaction with salary and benefits, as well as reduced absenteeism.)
How would you like to motivate your nurses even the ones at the top of their pay scale to improve their performances, reduce their absences, and even volunteer to lead inservices?
It’s not as difficult as you might think.
The same-day surgery department at St. Joseph Hospital in Augusta, GA, has used a pay-for- performance program to accomplish this, and more.
The grading is strict. For example, nurses are required to obtain their required licensure and certification, undergo a physical exam by their anniversary date, and complete their hours of mandatory continuing education.
"You might be a perfect’ employee with an 8% raise [otherwise], but you miss one of the three, your raise is cut in half," says Ann McCarty, RN, director of surgical services.
St. Joseph implemented the program hospitalwide because a lot of long-term nurses and other employees were reaching the top of their pay scale, says Barbara Fulmer, BSN, nurse manager of same-day surgery.
"Unless you had an across-the-board raise, you were stagnant once you reached the top of your pay scale," Fulmer says. "This gave them an incentive to do well to get an increase each year."
How does it work?
The annual budget determines the range of pay raises in the pay-for-performance program. For the first year, the pay raises ranged from 0 to 8%. Currently, the raises range from 0 to 6%, which is high in that community, Fulmer says.
Pay for performance is based on job-specific standards of care. These standards were developed by each individual group, such as nursing, but also for individual units within those groups, such as ones for the OR, PACU, endoscopy, and day surgery. (See standards enclosed in this issue.)
A nurse can earn a total of 200 points 50 points are awarded for meeting general standards such as attendance, education, and safe work practice, and 150 points for meeting job-specific standards, such as human resource management and patient care. In some areas, nurses can more than double their points if they exceed the standards, which would allow them to earn the highest raises.
How was it developed?
The first step for developing the standards was to ask employees to tell managers what tasks and skills their jobs involved. Managers used that information to write job descriptions with the help of an outside consulting firm, Jackson and Associates in Hickory, NC.
The criteria for the pay-for-performance program were written directly from the job description. "For example, we did a section on assessment and planning and implementing the plan of care," Fulmer says. "Some of the safety issues are in there, and evaluations of the care that was given."
Each criterion was assigned a set number of points. The hospital set priorities by awarding the most points in the areas that it wanted to emphasize. For example, nurses and other employees can earn up to 10 points by providing excellent service. This standard is measured by determining whether an employee personally contributes to a team environment.
The percentage of pay raise depended on the number of points earned by the nurses. For example, same-day surgery nurses who earn 300 points earn a raise of 5.6% if they are not at the top of their pay scale and a one-time payment of 5.6% of last year’s salary if they are at the top of their pay scale.
One of the areas that realized the largest impact from the pay-for-performance program was sick time. Nurses could earn from zero to 14 points, depending on how much sick time they took. In another area, nurses earned high points by leading inservices, so the pay-for-performance program encouraged them to take more of a leadership role in that area, McCarty says.
Don’t implement without these tips
Keep in mind that a pay-for-performance program requires you to keep extensive records on each employee, McCarty warns. For example, note any documentation errors and the date, she says. Then if an employee disagrees with his or her evaluation and pay raise, you have the paperwork to back you up, McCarty explains.
When evaluating employees, the managers explain how employees exceeded or didn’t exceed the standards, McCarty says. This system gives the employee goals for the next year, she says.
The first year of implementing such a program is difficult, McCarty warns. "Employees have a hard time grasping the concept, and nurse managers have a hard time implementing it," she says.
"Cheat sheets" help employees and managers understand how the general standards work, McCarty says. These sheets explain the point system and how to exceed the standards.
It took about 18 months for nurses and other employees to see the impact of the pay-for- performance program and accept it, McCarty says. Initially, some disgruntled employees who were accustomed to automatic raises of 5% were upset that their raises were much lower due to performance, and some of them left, McCarty says.
"We were aggressive with 8% raises to start off," she says. "If you do that, you’ll work with fewer employees, but harder-working employees."
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