Thought leadership

Performance Planning and Reviews for Medical Directors

Performance Planning and Reviews for Medical Directors

Performance Planning and Reviews for Medical Directors

As health systems move into the highly regulated and competitive landscape of 2019-2020, the drive to design and deliver more fully integrated health systems has become evident.

This demand for value-based care requires physicians and hospitals to rethink their traditional relationships.[1] Physicians and hospitals are being both pulled and pushed together in new ways by these changes, including increased direct employment of physicians by hospitals, the development of Accountable Care Organizations (intended to manage the quality and cost of care of defined populations of patients), new payment methodologies and financial incentives from public and private payers, and the need to deliver greater value in an increasingly competitive marketplace.

These market forces call for integrated physician-hospital leadership structures and

systems, particularly related to performance planning and performance reviews.

Unfortunately, performance reviews for physician leaders and medical directors are not well developed nor followed. A central strategy for high functioning integrated care systems in 2018 must include a more effective focus on how best to design, develop, and deploy modern physician leader performance planning cultures, philosophies, and infrastructures.

We encourage five (5) key actions to enable this strategy to yield needed gains in physician leadership engagement, performance, pride, and retention:

Action 1: Performance Philosophy

Action 2: Performance Training

Action 3: Performance Plan

Action 4: Performance Review

Action 5: Performance Celebration

Arrange for conversations about the following initiaitves among your board, executive and physician leaders early in 2019-2020.

Action 1: Performance Philosophy

Policies and procedures in health systems need to be guided by a clear statement of philosophy about the focus and importance of continuous improvement that comes from continuous performance planning and reviews, for not just managers, but also for physician leaders and medical directors.

Your performance management philosophy must recognize the multifaceted nature of physician leadership performance, and the value of gathering 360 degree input on performance goals, work processes and performance reviews.[2]

The performance management approach for physician leaders should also map directly to the vision and mission of the organization. We like the way HealthPartners in Minnesota[3] hardwires its performance links…

“In challenging times, it’s important to have a clear vision and a strong team. At HealthPartners, we have both. Our vision – health as it could be, affordability as it must be, through relationships built on trust – guides everything we do. We have a strong team of 25,000 people who partner with our patients, members and the community to improve health and well-being for all. As an industry-leading organization with care delivery, health plan and research capabilities, we’re dedicated to innovation and building healthier communities.”[4]

The performance management system must also be simple with minimum paperwork, or physicians will revolt. Organizations typically invest a significant amount of time (and therefore money) in performance management activities. Indeed, Deloitte recently calculated that their 65,000 employees were spending a total of 2 million hours a year completing forms, holding meetings and assigning and analysing ratings.[5] Keep your process and reliance on forms to optimal levels. Start small and expand as the value becomes evident to your medical directors.

Physician leadership assessment is also difficult because it requires success at the intersection of assessing capabilities and competency as a clinician[6], and as a leader/manager[7]. The two fields of inquiry are both complicated, and benefit from 360 degree insights from a variety of colleagues, supervisors and subordinates.

Action 2: Performance Training

The development of physician leader competencies requires a curriculum[8] that includes practical materials and case studies on physician performance management, and how to do it. Most local universities[9] now offer physician leadership training, and superior programming is available from the American Association for Physician Leadership[10] and the AHA Physician Forum.[11]

Action 3: Performance Plan

Physician leaders and medical directors need to be clear about performance expectations between them and their supervisors, and then be held accountable for the related results. Developing a standard plan of action driven toward clear targets of performance is becoming a hallmark of high performing health systems. We like the work at Henry Ford Health System.

At Henry Ford Physician Network, our performance management tools tell you exactly how well you are meeting that goal.

We do not view performance measurement as a requirement. We see it as an opportunity to identify areas for change, improve the quality of our care and ultimately create a better health care delivery model for our patients.[12]

Effective health systems not only define clear performance goals for each physician leadership position, but they are not hesitant to make these targets public for enhanced accountability. Accountability is not about blame—it is about a leader feeling urgency to align his or her behaviors to outcomes… “ if I know I am accountable in my department to improve Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) results, and that represents 30% of my evaluation, I feel urgency to hardwire evidence-based tactics like post-visit calls and nurse leader rounding that I know will impact HCAHPS outcomes”.[13]

Consulting with your Human Resource Executive will generate useful insights into the new software systems[14] that have evolved to support performance planning and then the related performance review. Strong systems use web based tools that both document the physician  leader’s performance goals for the coming year, as well as support the review process outlined below.

Action 4: Performance Review

Physician leadership reviews can be adapted from the review process used by CEOs with these characteristics:[15]

  • Guided by a philosophy of personal and professional growth
  • Driven to mutually defined measures of performance that are linked to the strategic mission and plans of the organization
  • Linked to metrics that are under the control of the physician leader
  • Linked to metrics that can be cost-effectively measured and reported on a monthly and quarterly basis.[16]

Assessing physician’s professional performance can also borrow ideas from the progress in other nations, such as Netherlands,[17] Canada and the UK[18].

The criteria guiding the process of clinical performance review should also be considered in the design of the physician leadership performance review, see

Attachment A also provides factors for the review process.

Action 5: Performance Celebration

Too many boards and executives see performance celebration as only linked to incentive compensation. While that is an important part of the glue that aligns physician leader behavior to the goals of the organization[19], it should not be the only or even the first link.

Physician leaders want to see how their administrative work maps to better patient care, stronger organizational vitality, and enhanced pride among their physician and nursing colleagues.

Non-cash recognition and celebrations that reinforce continuously enhanced physician leadership performance can include such varied initiatives as:

  • Short handwritten notes of appreciation by peers and supervisors
  • Walls of fame that showcase a photo/bio of high performing medical directors
  • Photo recognition in physician newsletters
  • Recognition dinners with thank yous from Board
  • Enhanced staff support
  • Access to tuition support for executive MBA studies
  • Travel to CME training
  • Notes of appreciation to spouse

[1] See:

[2] See:


[4] See: CEO Andrea Walsh message:


[6] See the challenge of clinical compentcies, here:

[7] For leadership compentencies seeL

[8] For sample PhysicianLeadership Academy curricula, see:  and also here:

[9] See

[10] See:

[11] See:

[12] See:

[13] A useful giide:

[14] See:

[15] See:  and also

[16] See:

[17] See:

[18] See:

[19] See: Heymans in Becker’s

James A. Rice

Jim Rice, PhD, FACHE is the Managing Director & Practice Leader with the Governance & Leadership service line of Gallagher’s Human Resources & Compensation Consulting practice. He focuses his consulting work on strategic governance structures and systems for high performing, tax-exempt nonprofit, credit union and health sector organizations and integrated care systems; visioning for large and small not-for-profit organizations; and leadership development for Boards and C-Suite Senior Leaders. 

Dr. Rice holds masters and doctoral degrees in ...

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