Pay Increase Budgets Remain Stable as Healthcare Employers Prepare for New Mandates

June 18, 2013

For more information, contact:
Jessica Wahaus
Marketing Manager
(800) 300-9570

Pay Increase Budgets Remain Stable as Healthcare Employers Prepare for New Mandates

Kansas City, Kan. – In 2014, the Affordable Care Act mandates will take effect and organizations will see significant changes that will likely trickle down and impact many areas including pay programs and practices. As a reflection of employers’ preparations for the new mandates, pay increase budgets in the healthcare industry have remained stable at 2.4 percent, according to the 2013 Compensation Data Healthcare survey results. The survey of more than 8,300 healthcare facilities also indicates employers expect pay increase budgets to be similar in 2014 at 2.5 percent.

“The Affordable Care Act and its impact on the bottom line is what are keeping healthcare executives up at night,” said Amy Kaminski, vice president for Compdata Surveys. “Although the implications remain to be seen, many are attempting to control workforce costs in preparation for the coming changes.”

Pay increase budgets across the industry have experienced little change over the past couple years, at 2.5 percent in 2012 and 2.4 percent in 2011. However, the behavioral healthcare sector has seen a significant increase in recent years. In 2011, behavioral healthcare facilities reported an average pay increase budget of 1.6 percent, compared to 2.4 percent this year. Other healthcare organizations have remained relatively stagnant over the past few years. Critical access hospitals and physician clinics reported pay increase budgets of 2.6 percent in 2013, compared to 2.8 percent in 2010. Hospitals and rehabilitation clinics each reported pay increase budgets of 2.3 percent this year, down slightly from 2.4 percent in 2012.

Employers use pay increase budgets to make various adjustments to employees’ salaries, such as merit increases, market adjustments, promotional increases and more. More than 74 percent of healthcare employers report using pay increase budgets to grant merit increases to employees, with an average merit increase budget of 2.1 percent. Nearly 39 percent of organizations use the pay increase budget for market adjustments, compared to 18.4 percent using it for promotional increases. Almost 11 percent of participating organizations allocated part of the overall pay increase budget to cost of living adjustments, with the average adjustment reported at 2.2 percent.

About the Survey
Compensation Data Healthcare 2013 provides a comprehensive summary of pay data, benefits information and pay practices with an effective date of January 1, 2013. The survey covers nearly 250 industry-specific job titles and 400 benchmark titles ranging from entry-level to top executives, with data collected from more than 8,300 healthcare facilities across the country.

Since 1988, Compdata Surveys has offered comprehensive data at affordable prices to organizations from coast to coast and is the nation’s leading compensation and benefits survey data provider. Thousands of organizations provide data in each of our industry-specific and general staff surveys every year, ensuring the reliability of our results. For more information about the compensation and benefits surveys, contact Jessica Wahaus at (800) 300-9570.