Of our 2004 salary survey is any indication, last year, HOPD and ASC managers alike brought in a median 4 percent compensation increase, and about one-third of managers from both settings received bigger raises - at times as much as 10 percent or more.

Of the 201 hospital and surgery center administrators who completed our online salary survey, most say they're satisfied with this picture, as well as their abilities to pay employees and even recruit and keep nurses. The dark side of this scenario is a real and widespread concern that, in the face of the rising cost of healthcare benefits, this trend cannot continue. How, ask managers, can they continue to make a fair living, offer the financial incentives they need to keep their outpatient facilities properly staffed, and still find funds to maintain their facilities?

Compensation picture
According to the survey of 74 HOPD and 127 ASC managers, OR and nurse managers in the hospital setting received more compensation than those in the ASC setting. The median compensation for the designations director of nursing and OR manager/ supervisor - including both salary and bonus - was about 12 percent to 13 percent higher for those in hospital settings.

ASC administrators, however, topped the compensation list among all managers polled (including hospital directors of surgical services) at a median $82,050. (See tables at left.)

ASC managers relied more heavily on bonuses than HOPD managers, and the bonuses were typically performance-based. Nearly two-thirds (61 percent) of ASC managers received bonuses, compared with just about one-third (32 percent) of HOPD managers, and the ASC managers' bonuses comprised a larger portion of their overall compensation. Among those who received them, bonuses accounted for an average 11.5 percent of ASC managers' 2004 compensation (range: less than 1 percent to 35.5 percent of base salary) and 7.5 percent of HOPD managers' compensation (1 percent to 22 percent of base salary). The determining factors also differed somewhat between settings. While facility profits and patient satisfaction topped the list of deciding factors at both settings, physician satisfaction and case costs were more likely to factor into ASC managers' bonuses, says our survey.

The 2004 compensation for HOPD and ASC managers represents a median increase over the prior year of 4 percent (range: 0 percent to 12.5 percent for ASC managers; 0 percent to 10 percent for HOPD managers). Just a few responders from both settings reported decreased compensation.

Nurses (including OR, recovery and pre-op nurses) and OR techs in both settings also received an average 3 percent to 4 percent compensation increase in 2004. HOPD and ASC nurses received strikingly similar compensation, but OR techs working in the ASC earned a median compensation that was 11 percent higher than their HOPD counterparts (see tables on p.27). Like their managers, nurses and OR techs working in the ASC were more likely to rely on bonuses as part of their overall pay than their hospital peers (see "How Bonuses Are Determined").

Just more than one-half of ASC nurses and OR techs received a 2004 bonus; about one-third of their HOPD counterparts received a 2004 bonus.

Regardless of setting, nearly 100 percent of managers, nurses and OR techs alike receive health benefits. HOPDs shine, however, when it comes to other traditional benefits. More HOPD managers, nurses and OR techs receive dental (95 percent of HOPD vs. 78 to 84 percent of ASC responders depending on job title), vision (77 percent vs. 55 to 58 percent), pension/retirement (94 to 96 percent vs. 75 to 84 percent), tuition reimbursement (70 to 75 percent vs. 38 to 42 percent) and paid maternity (26 to 35 percent vs. 10 to 15 percent) benefits. More HOPD nurses also qualify for overtime pay. Two-thirds of HOPD pre-op, OR and recovery nurses receive overtime pay; about 60 percent of their ASC counterparts do.

An end in sight?
The majority of responders from both settings expressed satisfaction with their compensation, their ability to compensate their employees, and even their ability to recruit and keep nurses (see "Are You Satisfied With Your Compensation?"). However, the air of concern that this is about to end was palatable. This is because, on one hand, the demand for quality care and the nursing shortage are driving facilities to keep nurses' compensation packages competitive. On the other hand, skyrocketing costs of healthcare benefits and stagnating reimbursements are squeezing the bottom line.

"My biggest compensation issue is salary increases that are growing faster than reimbursement increases," says Beverly Kirchner, BSN, CEO/president of Genesee Associates, Inc., Lewisville, Texas. "It will catch up to all of us eventually if salaries do not taper off or managed care does not agree to pay for the services their patients receive in ASCs."

Adds Susan Musser, BSN, RN, administrator of the Hershey Outpatient Surgery Center in Hershey, Pa.: "Benefits such as health and dental are the biggest issues for the upcoming year. We expect a 15 percent to 20 percent increase in premiums and struggle to address this."

Other responders reported health plan cost increases as high as 30 percent to 40 percent that, even with a 3 percent or higher salary increase, promise to bite into take-home pay, especially that of those on the lower end of the pay scale. "Employees' annual merit raises will not cover their increase in the health insurance contribution," says Chris Riedel, RN, BS, administrator of the Foundation West Houston Surgical Center in Houston. "Rates increased by 40 percent. We encourage ' taking an option with a higher deductible and co-pay but a lower premium." Several responders complained specifically about rising prescription drug costs for their employees. Prescription drugs represent one of the fastest-growing segments of national healthcare spending, thanks to rising manufacturers' prices, high costs of new drugs and more prescriptions than ever before.

What about the bricks and mortar? Karen Wood, administrator of the Portland, Ore.-based Cedar Hills Surgery Center, expresses concern that these growing pressures will ultimately affect the physical state of her facility. "The biggest compensation-related issue I currently face is how to compensate the ASC as an entity in the face of ever-growing demands and expectations of staff," she says. "The entity itself needs to be nurtured and fed, the same as staff. If not, the signs of neglect show relatively soon and are disastrous for business."

One day at a time
As in the past, however, surgical facility managers are showing potential to be remarkably resourceful in the face of mounting cost and compensation pressures. One surgical services manager with an independent hospital says she wants to join forces with other hospitals and clinics to obtain lower-cost health insurance and pharmacy coverage for her employees. Another ASC administrator says she welcomes the idea of hiring retired OR nurses for just a few hours during the busy part or end of the day, and she encourages moms to work only during school hours or after their spouses get home from work.

Several other managers are quick to point out that other factors, like recognition and compassion, can also rise above compensation issues. Says one ASC executive director: "Salaries are not the only things that attract and keep good employees. We try to allow them to have time off for appointments and take into account family issues. We have parties, we give employee-of-the-month awards, we honor OR nurses week, we give flowers. Little things like this can make all the difference in the world between satisfied employees and ones who are looking for employment elsewhere."