In these days of job loss, a sluggish economy and iffy consumer confidence, there's very good news for surgery center administrators. In the first Outpatient Surgery salary survey, those with the title of administrator or director reported an average salary of $82,215 in 2003, 8.3 percent higher than the Bureau of Labor Statistics's nationwide average for medical managers of $75,937.
We e-mailed our Web-based survey early last month to more than 2,000 surgery center administrators or nurse managers across the United States, and 153 responded: 96 administrators/directors and 57 nurse managers. Some key findings:
- Administrator/directors of hospital outpatient surgery centers reported an annual income of $85,077, about $5,700 more per year than the $79,358 administrators of freestanding ambulatory surgery centers reported earning.
- The majority of surgery center administrators receive a bonus (based most often on patient and physician satisfaction, case volume and cost per case), tuition reimbursement and 401(k) retirement plan, and have received a salary increase in the past year.
- Nurse managers reported an annual income of $60,777.
Tops on the wish list
It's clear that facility managers across the country feel that they're well compensated for the demanding work that they do and the many hats that they wear. Here's what the manager of an Ohio hospital surgery center had to say: "Few top-level administrators fully understand the complexity of effectively managing an operating room. Cost, contracts and productivity can have excessive variances from one OR to the next, where single decisions can vary by hundreds of thousands of dollars without administration noticing. Having (and paying for) staff that manages the resources while effectively working with the surgeons and staff will drastically impact the bottom line. The OR is not the place to look for 'bargain' managers."
Of course, not everyone's satisfied. Some complaints:
- 13 percent of administrators haven't received a salary increase in more than a year;
- 40 percent of administrators don't receive a bonus; and
- many wished for a more generous benefits package, one that included such perks as stock options, better medical and dental coverage, incentives, an education allowance and an on-site day care center.
What people make
On average, administrators made about $20,000 more than nurse managers (average of $60,777), and were more likely to receive a larger salary increase. While more than one-half (57 percent) of administrators received a bonus, slightly less than one-fourth (23.5 percent) of nurse managers did. Tuition reimbursement was just as common in both groups (86.7 percent for administrators, 85.3 percent for nurse managers). Nine in 10 administrators reported a 401(k) retirement plan; seven in 10 nurse managers reported a 401(k).
Nearly one-fifth (19 percent) of surgery center administrators made more than $100,000 a year. While surgery center nurse managers came in at a lower annual salary than the BLS salary for Managers, Medicine and Health, they still made an average of about $15,000 more than the BLS figure for full-time RNs.
Both administrators and nurse managers make a good bit more than the professionals they supervise. In our survey, most pre-op nurses made $30,000 to $50,000, OR and recovery nurses made $40,000 to $50,000, and OR techs made $30,000 to $40,000. Our respondents expressed commitment to fair salaries that are competitive in the region.
"It's crucial to be aware of our local salaries and benefits. It's difficult to hire and retain good people without being competitive. Professionals need to be rewarded for their hard work," says the director of a freestanding ASC in Texas.
"Our physician owners gave me an ultimatum - keep this staff happy and intact. We provide perks such as outerwear with our logo, quarterly outings at center expense, a lavish holiday party and many little gifts," says the administrator of a freestanding ASC in Colorado.
"Living in the Bay Area presents a unique challenge for employers regarding salaries. There are so many employment opportunities for nurses in this area, the salaries must be competitive to attract and keep qualified nurses. Our facility does a good job in keeping up with the competition around them in the salary department," notes Susan Hatheway, the OR supervisor at the Reproductive Science Center of the San Francisco Bay Area in San Ramon, Calif.
"The salaries still need to increase to attract RNs to the field. Pay them, and they will come," says Jacqueline Reynolds, the OR manager at the Riverview Medical Center in Red Bank, N.J.
Type of facility and location
Not surprisingly, our survey revealed that the type of surgical facility had an impact on managers' salaries. Directors of hospital outpatient surgery centers made an average annual income of $85,077, as compared to $79,358 for administrators of freestanding ASCs.
"Nurses in ASCs need excellent incentive packages - bonus, additional time off, true profit sharing based on the center's performance - as their salaries in comparison to hospital RNs is much less," says the manager of a New Jersey ASC.
The same holds true for nurse managers. Most of those who work in hospital surgery centers make $60,000 to $80,000, while most nurse managers in freestanding ASCs make $50,000 to $70,000.
Geographic location of a surgery center impacts how much surgery center managers make. When comparing salaries only, administrators tend to make the most in the Southwest, where two-thirds make $80,000 or more. The next best-paid were in the Southeast, where six in 10 made $80,000 or more. Midwestern administrators tended to make $50,000 to $80,000, while most administrators in the Northeast made $50,000 to $70,000. Those in the Northwest were more of a mixed bag, with half making $50,000 to $60,000, and half making $80,000 or more.
These geographical differences didn't hold true when comparing salaries between hospital surgery centers and freestanding ASCs. The best-paid hospital administrators were in the Northeast, where eight in 10 made $80,000 to $100,000. Next were those in the Northwest, all of whom made $80,000 to $90,000. Three-fourths of those in the Southeast made $80,000 or more. Two-thirds of those in the Midwest made $70,000 to $100,000.
Administrators of freestanding ASCs tend to have the highest salaries in the Southeast, where 75 percent made $80,000 and higher. The next-best-paid were administrators in the Southwest; 65 percent made $80,000 and higher. Two-thirds of administrators in the Northeast make $80,000, but their salaries topped out at $100,000. Four in 10 Midwestern administrators made $80,000 or more. The lowest-paid were in the Northwest, where two-thirds (67 percent) made $50,000 to $60,000.
Most surgery center administrators have received salary increases in the past year. About one-third received modest increases of 2 or 3 percent, but 37 percent received an increase of more than 4 percent.
Bonus and benefits
Like employees everywhere, bonus and benefits are important to surgery center managers. Nationwide, 57 percent of surgery centers offer bonus or incentives to management and staff, although this figure goes as high as 80 percent in some regions (Northwest, Southeast). These bonus plans usually are based on patient satisfaction (52 percent) or physician satisfaction (44 percent). Many respondents noted that factors like profitability, percent of revenue over budget and performance improvement are considered as well. Surgery center administrators say these incentives are important.
"As a commitment to high-quality staff retention, our board of managers adopted a progressive staff incentive program at the very start of operations. Quarterly we distribute a range of 2 to 5 percent of total profits back to the employees based on an individual merit methodology. This has resulted in great staff morale and minimal turnover," says John Gleason, the administrator of Berks Center for Digestive Health in Wyomissing, Pa.
"Our profit-sharing plan is unique in that it pays the same hourly rate to all employees, regardless of status or salary. A percentage of our total net margin is divided by the total hours worked in a semi-annual period. The idea is that the more hours you work, the more impact you can, potentially, have on the bottom line," says Laurie M. Johnson, the administrative director at Orthopaedic Outpatient Surgery Center in West Des Moines, Iowa.
Eight in 10 surgery centers provide tuition reimbursement, although this figure was 100 percent in some regions. Nine in 10 facilities provide a 401(k) retirement plan, and respondents from the few centers that don't offer a 401(k) wish their employers did. Other benefits administrators would like include
- fully paid dental, medical and vision;
- prescription drug coverage or drug discount card;
- short- and long-term disability;
- 403(b) retirement plan;
- years-of-service bonus;
- profit sharing;
- fitness-center discount; and
- an on-site day care center.
Managers who are dissatisfied with benefits express a strong desire to improve them.
"Benefits are very problematic," notes the director of a hospital surgery center in Savannah. "We offer health insurance, life and vision, but the premiums are very high; it's very restrictive. We also have paid time off instead of vacation, holiday and sick days, but the accrual rates are not competitive."
A total package
Generally, surgery center managers are well compensated with a total package that includes salary and benefits.
"I have worked at St. Helena Hospital for about 17 years. I love the place and don't plan on moving anytime soon. They (administration) have encouraged me to continue my education and are helping me with tuition reimbursement. Can't get much better," says Benton Duckett, the director of surgical services for St. Helena Hospital in Derr Park, Calif.
Administrator/directors of outpatient surgery facilities make the most in the Southwest, as well as receive a bonus, good benefits and the largest salary increase. If you're the administrator of a freestanding, multi-specialty ASC, you'll receive the best total package in the Southeast. Administrator/directors of hospital in-outpatient facilities receive the best compensation package in the Midwest.
"We're in a growth industry, so we have been sharing in that growth," notes an administrator of a hospital surgery center in Dallas. "Let's hope it keeps up."