Accounting Papers
Title
Performance-Based Compensation in Member-Owned Firms: An Examination of Medical Group Practices
Document Type
Journal Article
Date of this Version
12-2007
Publication Source
Journal of Accounting and Economics
Volume
44
Issue
3
Start Page
300
Last Page
327
DOI
10.1016/j.jacceco.2007.05.001
Abstract
We examine the importance of agency considerations for the mix of salary and performance-based compensation in member-owned medical practices. Performance-based pay increases with the informativeness of clinical productivity measures, and declines with greater reimbursement from capitation contracts. Inexperienced physicians receive more compensation from salary, but compensation mix does not change as physicians near retirement. Larger practices and practices using outside management companies place more weight on performance-based compensation. However, when more physicians in the group practice the same specialty, less emphasis is placed on performance-based compensation. Finally, the presence of an executive partner has no influence on compensation mix.
Copyright/Permission Statement
© 2007. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/
Keywords
compensation, pay-for-performance, agency theory, professional service firms, health care
Recommended Citation
Ittner, C. D., Larcker, D. F., & Pizzini, M. (2007). Performance-Based Compensation in Member-Owned Firms: An Examination of Medical Group Practices. Journal of Accounting and Economics, 44 (3), 300-327. http://dx.doi.org/10.1016/j.jacceco.2007.05.001
Date Posted: 27 November 2017
This document has been peer reviewed.