Time to Tie Executive Pay to Health Equity Metrics?

Oct. 26, 2020
‘We are putting our money where our mouth is,’ says Kevin Mahoney, CEO of the University of Pennsylvania Health System

Besides testing health systems’ resilience in meeting a public health crisis, the pandemic also has forced them to grapple with health equity issues involving vulnerable populations in their communities. What will force them to make even more significant changes to reduce disparities? Tying executive compensation to community health metrics is one approach.

“We are putting our money where our mouth is,” said Kevin Mahoney, M.B.A., D.B.A.,
 CEO of the University of Pennsylvania Health System.

Speaking during an Oct. 23 webinar put on by the University of Pennsylvania Leonard Davis Institute of Health Economics, Mahoney said, “We built it into the pay of the top 600 executives a Penn Medicine. Our executive pay is tied to reducing maternal morbidity and mortality among Black and Brown populations and increasing colorectal screening among our Black population. If we don’t make those improvements, we don’t get paid. It is taking money out of your paycheck. Because we know that incentives work. We are tired of talking about it. We are going to take dramatic action, but doing it by impacting the higher-paid people’s paycheck. I wish it didn’t have to come to that, but that is the way we know we can move the needle. I’ll be happy to report next year — I know we’ll have achieved these goals because we built them in.”

The webinar’s larger focus was the financial toll of the COVID-19 pandemic on healthcare provider organizations, but it also extended to the public and private investment needed in the aftermath of COVID-19, and that led to a discussion of ways to prevent health systems from returning to traditional ways of operating once the pandemic ends.

Farzad Mostashari, M.D., founder and CEO of Aledade Inc. and former national coordinator for health information technology, responded to Mahoney’s commitment to change by describing Aledade’s approach.

“In the aftermath of George Floyd I wrote that I was ashamed that we had been empathetic bystanders in the past to racial disparities,” he said. “We had an assumption that if we were doing population health, and focusing on everybody, that it was good and would improve racial disparities.” Although they saw improvements in some metrics among both African-American and white patients that Aledade’s independent practices serve, the differences between the two populations weren’t decreasing.

“Even where we offer equality in treatment, which we are, we are not seeing equity in outcomes, and that is what matters,” Mostashari said. “So we picked blood pressure control, because 22 percent of our African-American elderly patients have severely uncontrolled hypertension compared to 14 percent in our white seniors. We said we were going to cut that disparity in half. But we have to explicitly look at it, measure it, trend it, track it, and motivate against it if we want to make progress. Doing general population health isn’t going to fix it.”

Andie Martinez Patterson, M.P.P., vice president of government affairs for the California Primary Care Association
, said she is committed to payment reform “because I fundamentally believe that will change the entire way we look at our populations. So keeping telehealth payments, moving to payment reform, and putting incentives at the top to drop disparities is essential,” she said. “All of us to have to dive a little further into the history we might have ignored on anti-racism. A personal exploration as well as a systemic exploration is necessary.”

Rebekah Gee, M.D., M.P.H., M.S., is CEO of the Louisiana State University Health Care Services Division and former secretary of the Louisiana Department of Health during its Medicaid expansion. She responded to this aspect of the conversation by stating that healthcare is a right.

“I don’t think we can have legitimate discussions about equity if we deny people healthcare in this country,” she said. “We have to fix that. We also have to focus on it and measure it.” She noted that LSU created the first Office of Health Equity in the South and was able to improve health outcomes – most recently maternal mortality by 60 percent — by looking at disparities. “You have got to look at it, measure it and report on it and hold yourself accountable on it. You have to train your staff to understand where bias may come in.”

Gee added that we have to change the way the healthcare work force looks. “How do we partner more and make sure our medical school class looks like the community we serve? LSU is committed to that.”

Finally, she asked, if health systems don’t pay taxes because they are doing community benefit, what does that mean for the community? Are those real investments? “Are we holding them accountable for their true commitment to the populations they serve? Or that those investments don’t just lead to new proton beams or new lovely wings of a hospital, but actually lead to change? What does the leadership look like? How do we make sure individuals of color are represented on every board and that we hear and listen to each other and reflect on where we are and why we are there?”

Gee called it “an incredible moment in this country when we have COVID coalesce with this moment of racial equity and accounting. So I am very optimistic. As Farzad said earlier, things are changing and I see a much brighter future despite the fact that it has been so difficult.”

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