Trends in Physician, Advanced Practice and Executive Compensation

Trends in Physician, Advanced Practice and Executive Compensation 3/09/16 HR Leadership Council 1 Presenters Bios Fred Horton is Vice President of AMGA Consulting Services, LLC. Fred is a dynamic healthcare advisor who possesses industry experience, market insight, exemplary capabilities managing diverse and challenging projects, and the ability to create tangible results on behalf of his clients. Fred has over 20 years of experience working inside the healthcare industry, which included serving as President/CEO of two large integrated multispecialty medical groups and one health system. Fred s special qualifications include physician/hospital governance models, physician/hospital alignment strategies, operational improvement plans, turnaround and start-up management and physician compensation plan development and implementation. Fred is a Certified Medical Practice Executive (CMPE). He holds a Bachelor of Arts degree in Healthcare/Business Administration from Augustana College and a Master of Healthcare Administration degree from the University of Minnesota. Aaron Dobosenski is a Consulting Manager of AMGA Consulting Services, LLC. Aaron focuses on data management and analytics. Prior to joining AMGA s consulting group, he managed data analysis and operations planning for national and international retail operations. He has over 14 years of experience in data analytics and operations planning and significant experience in systems development, project management, and process and system automation. Aaron is focused on data management and benchmarking for physician compensation engagements. He also serves as a key team member producing and evaluating physician compensation, productivity and benefits surveys. Aaron holds a Bachelor of Arts degree in mathematics from St. Mary s University, where he was a member of the Phi Mu Epsilon Mathematics Honor Society. He is currently studying at Mitchell Hamline School of Law in St. Paul, Minnesota, where he will earn his JD in May, 2016. 2 1

Table of Contents Item Page Trends in Physician Compensation 4 Goals, Background and Trends in APP Compensation 19 Executive and Leadership Compensation Survey 31 3 PHYSICIAN COMPENSATION- TRENDS IN SURVEY DATA 4 2

Market Trends and Directions 28 th Annual AMGA Provider Compensation Survey Data on clinical compensation, work RVU, net collections, gross productivity, comp to productivity ratios, visits, benefits 134 Physician Specialties, 27 Other Provider Specialties NP and PA breakdowns 5 AMGA Survey Participants 6 3

Base Salary 7 Production Models 8 4

Incentive Pay 9 Incentive Pay Average quality incentive as a percent of overall compensation is 5.4% 10 5

MGMA - AMGA Trend Comparison Provider Compensation 2015 REPORT BASED ON 2014 DATA Total Compensation Trending 2015 MGMA. All rights reserved. Data extracted from MGMA DataDive All Practice Types Specialty 2012 2013 2014 Overall AMGA Cardiology: Noninvasive $441,728 $426,295 $476,376 7.84% $452,500 7.49% Family Medicine (without OB) $207,117 $211,452 $221,419 6.91% $225,899 0.93% Gastroenterology $521,216 $510,671 $504,492-3.21% $506,022 16.97% Hospitalist: Internal Medicine $240,352 $253,977 $263,511 9.64% $263,500 9.22% Internal Medicine: General $224,110 $229,000 $238,227 6.30% $239,968 5.79% Obstetrics/Gynecology: General $301,737 $309,028 $317,496 5.22% $321,747 2.95% Orthopedic Surgery: General $538,533 $559,137 $568,319 5.53% $572,790 9.10% Pediatrics: General $216,112 $220,853 $226,408 4.76% $233,609 4.84% Surgery: General $367,885 $383,598 $395,456 7.49% $390,481 4.55% 11 Total Compensation Median Physician Compensation 2012-2015 2014-2015 2013-2015 2012-2015 2012-2015 Percent Percent Percent Dollar Specialty 2015 2014 Change 2013 2012 Change Change Change Medical Specialties Allergy/Immunology 281,100 267,338 5.15% 270,904 268,116 3.76% 4.84% 12,984 Cardiology 452,500 425,000 6.47% 420,991 430,316 7.48% 5.16% 22,185 Cardiology - Cath Lab 588,910 544,733 8.11% 547,112 524,731 7.64% 12.23% 64,179 Dermatology 453,909 419,146 8.29% 411,499 397,370 10.31% 14.23% 56,539 Endocrinology 241,926 233,769 3.49% 234,258 221,400 3.27% 9.27% 20,526 Family Medicine 225,899 229,607-1.61% 223,810 219,362 0.93% 2.98% 6,537 Gastroenterology 506,022 471,336 7.36% 432,616 435,120 16.97% 16.29% 70,902 Hematology and Medical Oncology 407,000 367,404 10.78% 350,268 348,157 16.20% 16.90% 58,843 Hospitalist - Internal Medicine 263,500 249,599 5.57% 241,250 236,500 9.22% 11.42% 27,000 Hypertension and Nephrology 309,000 288,661 7.05% 277,449 277,934 11.37% 11.18% 31,066 Infectious Disease 247,362 247,342 0.01% 242,447 229,511 2.03% 7.78% 17,851 Internal Medicine 239,968 237,548 1.02% 226,833 224,417 5.79% 6.93% 15,551 Neurology 280,126 268,096 4.49% 255,004 249,250 9.85% 12.39% 30,876 Pediatrics & Adolescent - General 233,609 232,097 0.65% 222,827 220,644 4.84% 5.88% 12,966 Psychiatry 246,500 232,750 5.91% 224,878 217,194 9.62% 13.49% 29,306 Pulmonary Disease (without Critical Care) 335,928 304,367 10.37% 300,646 304,901 11.74% 10.18% 31,027 Rheumatologic Disease 247,112 239,112 3.35% 240,250 229,051 2.86% 7.88% 18,061 Urgent Care 251,680 245,606 2.47% 239,733 242,145 4.98% 3.94% 9,535 Surgical Specialties Cardiac / Thoracic Surgery 596,637 569,073 4.84% 525,944 544,087 13.44% 9.66% 52,550 Emergency Medicine 324,015 316,739 2.30% 301,000 297,500 7.65% 8.91% 26,515 General Surgery 390,481 380,778 2.55% 373,478 370,024 4.55% 5.53% 20,457 OB/GYN - General 321,747 322,423-0.21% 312,541 303,350 2.95% 6.06% 18,397 Ophthalmology 401,926 380,600 5.60% 372,552 371,987 7.88% 8.05% 29,939 Orthopedic Surgery 572,790 538,123 6.44% 525,000 515,759 9.10% 11.06% 57,031 Otolaryngology 419,500 393,287 6.67% 383,141 374,387 9.49% 12.05% 45,113 Urology 433,308 434,563-0.29% 424,603 415,598 2.05% 4.26% 17,710 Radiology/Anesthesia/Pathology Anesthesiology 416,094 398,240 4.48% 394,734 377,375 5.41% 10.26% 38,719 Radiology - Non-Interventional 483,660 476,013 1.61% 453,216 459,186 6.72% 5.33% 24,474 Weighted Average (by phy count) 2.61% 5.96% 7.68% 23,785 12 6

Work RVUs Median Work RVUs 2012-2015 Specialty 2015 2014-2015 Percent 2014 Change 2013 2012 2013-2015 2012-2015 2012-2015 Percent Percent Unit Change Change Change Medical Specialties Allergy/Immunology 4,020 3,952 1.74% 4,033 3,855-0.30% 4.29% 165 Cardiology 7,414 7,335 1.08% 7,150 6,934 3.70% 6.92% 480 Cardiology - Cath Lab 9,541 8,804 8.36% 8,491 8,298 12.36% 14.97% 1,242 Dermatology 7,570 7,333 3.24% 7,389 7,282 2.45% 3.96% 288 Endocrinology 4,737 4,601 2.97% 4,463 4,393 6.15% 7.85% 345 Family Medicine 4,863 4,975-2.25% 5,010 4,890-2.94% -0.54% -26 Gastroenterology 8,427 8,349 0.94% 7,947 7,992 6.04% 5.45% 436 Hematology and Medical Oncology 4,679 4,652 0.57% 4,630 4,393 1.05% 6.51% 286 Hospitalist - Internal Medicine 4,273 4,156 2.81% 4,013 4,021 6.47% 6.26% 252 Hypertension and Nephrology 6,643 6,390 3.97% 6,418 6,159 3.51% 7.86% 484 Infectious Disease 4,579 4,754-3.69% 4,742 4,299-3.44% 6.51% 280 Internal Medicine 4,873 4,708 3.51% 4,723 4,717 3.18% 3.31% 156 Neurology 4,820 4,639 3.90% 4,790 4,717 0.63% 2.19% 103 Pediatrics & Adolescent - General 5,411 5,448-0.69% 5,425 5,111-0.26% 5.86% 299 Psychiatry 4,109 4,169-1.43% 3,737 3,381 9.98% 21.54% 728 Pulmonary Disease (without Critical Care) 5,611 6,120-8.30% 6,129 6,057-8.45% -7.36% -446 Rheumatologic Disease 4,800 4,558 5.31% 4,557 4,662 5.34% 2.97% 139 Urgent Care 4,905 5,184-5.38% 5,271 5,217-6.94% -5.97% -312 Surgical Specialties Cardiac / Thoracic Surgery 9,595 9,700-1.08% 9,229 9,500 3.97% 1.00% 95 Emergency Medicine 7,009 7,664-8.54% 7,216 7,073-2.87% -0.90% -64 General Surgery 6,857 6,782 1.11% 6,942 7,026-1.22% -2.41% -170 OB/GYN - General 7,032 6,974 0.82% 6,706 6,476 4.86% 8.59% 556 Ophthalmology 8,636 8,460 2.08% 8,813 8,649-2.01% -0.15% -13 Orthopedic Surgery 7,792 8,133-4.19% 7,886 8,026-1.18% -2.91% -233 Otolaryngology 6,955 6,775 2.67% 6,828 6,891 1.87% 0.93% 64 Urology 7,536 7,344 2.61% 7,317 7,456 2.98% 1.07% 80 Radiology Anesthesiology 11,350 11,207 1.28% 11,095 11,420 2.30% -0.61% -70 Radiology - Non-Interventional 8,605 8,463 1.68% 7,892 7,423 9.03% 15.92% 1,182 Weighted Average (by phy count) 0.44% 1.68% 3.62% 202 13 Net Collections Median Net Collections 2012-2015 2014-2015 Percent Specialty 2015 2014 Change 2013 2012 2013-2015 2012-2015 2012-2015 Percent Percent Dollar Change Change Change Medical Specialties Allergy/Immunology 671,466 626,034 7.26% 547,393 523,462 22.67% 28.27% 148,004 Cardiology 546,068 506,979 7.71% 546,389 576,596-0.06% -5.29% -30,528 Cardiology - Cath Lab 598,013 577,444 3.56% 587,543 613,354 1.78% -2.50% -15,341 Dermatology 956,141 998,357-4.23% 953,342 878,155 0.29% 8.88% 77,987 Endocrinology 417,454 387,185 7.82% 367,575 380,909 13.57% 9.59% 36,545 Family Medicine 434,560 458,748-5.27% 440,651 428,306-1.38% 1.46% 6,254 Gastroenterology 770,361 802,444-4.00% 746,861 777,816 3.15% -0.96% -7,455 Hematology and Medical Oncology 349,312 341,184 2.38% 336,965 352,950 3.66% -1.03% -3,637 Hospitalist - Internal Medicine 220,662 209,334 5.41% 207,768 211,811 6.21% 4.18% 8,851 Hypertension and Nephrology 465,824 409,810 13.67% 427,900 423,775 8.86% 9.92% 42,049 Infectious Disease 280,685 302,477-7.20% 301,677 285,048-6.96% -1.53% -4,363 Internal Medicine 455,062 439,379 3.57% 410,976 408,165 10.73% 11.49% 46,897 Neurology 398,801 360,453 10.64% 383,833 395,534 3.90% 0.83% 3,267 Pediatrics & Adolescent - General 558,550 561,253-0.48% 503,707 466,373 10.89% 19.76% 92,177 Psychiatry 251,776 251,648 0.05% 230,960 211,945 9.01% 18.79% 39,831 Pulmonary Disease (without Critical Care) 416,953 408,942 1.96% 416,926 414,510 0.01% 0.59% 2,443 Rheumatologic Disease 462,540 397,797 16.28% 401,310 414,586 15.26% 11.57% 47,954 Urgent Care 519,910 525,019-0.97% 533,962 495,214-2.63% 4.99% 24,696 Surgical Specialties Cardiac / Thoracic Surgery 564,651 610,575-7.52% 596,113 626,425-5.28% -9.86% -61,774 Emergency Medicine 328,695 331,562-0.86% 324,380 341,377 1.33% -3.71% -12,681 General Surgery 532,918 564,093-5.53% 586,061 597,620-9.07% -10.83% -64,702 OB/GYN - General 703,100 667,077 5.40% 633,558 651,510 10.98% 7.92% 51,590 Ophthalmology 920,016 860,596 6.90% 824,562 789,467 11.58% 16.54% 130,549 Orthopedic Surgery 876,607 846,216 3.59% 874,626 836,221 0.23% 4.83% 40,387 Otolaryngology 776,119 744,636 4.23% 770,602 724,936 0.72% 7.06% 51,183 Urology 752,231 787,802-4.52% 760,689 790,826-1.11% -4.88% -38,595 Radiology/Anesthesia/Pathology Anesthesiology 427,364 471,292-9.32% 490,692 458,091-12.91% -6.71% -30,727 Radiology - Non-Interventional 690,818 691,625-0.12% 654,634 640,034 5.53% 7.93% 50,784 Weighted Average (by phy count) 0.53% 3.47% 4.58% 20,694 14 7

3/1/2016 Ranking Median Compensation (n>200) Other than FM with OB, PCP Spec. are not moving up the list. 15 Market Trends and Directions Most compensation models today maintain a large productivity element. Quality/clinical outcomes have moved beyond process measures (for many). Patient satisfaction (or proxy) has become a standard measure, but it represents a small percentage of overall pay. Use of citizenship (expected behaviors) varies by organization. Few groups have 20% or more at risk for non-productivity metrics. 16 8

Non-Productivity Metrics Primary Care Metrics Patient access (e.g. time to get an appointment, 3 rd Next Available) Panel size (e.g. number of unique patients, age, gender and severity adjusted) Mid-Level provider supervision and Team Based Care coordination fee (e.g. per patient per month) PCMH development Chronic disease/ambulatory condition management (e.g. Diabetes) Quality Metrics - Preventive Mammogram screening Colon Cancer screening Cervical screening Osteoporosis screening Flu vaccination Pneumonia vaccination Blood pressure screening Cholesterol screening Patient Satisfaction Metrics AMGA, Press Ganey, Avatar and others Peer-peer reviews Staff-peer reviews Patient phone or email surveys 17 Non-Productivity Metrics Specialist Metrics Post-discharge summary to PCP Readmission reduction On-time surgical starts Discharge planning Patient access to specialist appointment Supply standardization Timely consults (measured by PCP survey or set timeframe) Care coordination Quality Metrics Inpatient SCIP & core measures NCQA/HEDIS/NQF Standards Care model development/adoption Patient outcomes around identified conditions Completed health risk assessments/screening exams 33 ACO quality metrics Use of disease registries Citizenship Metrics Timely medical records completion Successful coding audits MU adoption Meeting attendance Call coverage Risk management/ compliance education Provider flu and tuberculosis vaccination Referral Patterns Appropriate utilization of organization assets Assistance with integration 18 9

APP COMPENSATION- GOALS, BACKGROUND, AND TRENDS 19 Goals for APP Redesign Align APP and Organizational Goals Foster Physician/APP Collaboration Enhance Ability to Recruit and Retain APP Compensation Plan Goals Bonus Program Production Service Quality Citizenship Goals for redesign tend to be similar to the organization s goals and charter for physician compensation redesign. 20 10

Historical Market Practices Longevity $ Mix of Roles Limited Specialty Differentiation Lack of Focus on wrvus 21 APN Market Data Nurse Practitioner and Physician Assistant Subspecialties Total Compensation Number of Number of Group Physician 90th 80th 20th Standard Specialty Responses Responses Percentile Percentile Median Percentile Mean Deviation Nurse Practitioner - Medical Specialty 114 1,567 128,297 116,729 100,855 88,659 104,532 26,074 Nurse Practitioner Primary Care 133 2,566 141,136 122,292 100,780 86,715 106,530 31,075 Nurse Practitioner Surgical Specialty 90 732 139,622 124,800 102,981 88,989 107,844 28,748 Physician Assistant Medical 94 1,011 136,571 123,588 102,804 88,650 107,667 29,672 Physician Assistant Primary Care 104 1,443 151,565 130,333 105,060 88,243 111,521 32,480 Physician Assistant Surgical 99 1,151 149,881 133,952 113,733 96,193 118,557 32,499 Limited variability compared to physician specialty variation 22 11

APN Market Data Nurse Practitioner and Physician Assistant Subspecialties Work RVUs Number of Number of Group Physician 90th 80th 20th Standard Specialty Responses Responses Percentile Percentile Median Percentile Mean Deviation Nurse Practitioner - Medical Specialty 93 946 3,814 3,155 2,084 1,112 2,263 1,306 Nurse Practitioner Primary Care 111 1,794 4,939 4,383 3,327 2,203 3,332 1,320 Nurse Practitioner Surgical Specialty 67 422 4,222 3,489 2,174 1,137 2,407 1,422 Physician Assistant Medical 72 567 4,382 3,526 2,240 1,282 2,517 1,476 Physician Assistant Primary Care 83 990 5,385 4,735 3,733 2,615 3,714 1,386 Physician Assistant Surgical 78 771 4,365 3,376 1,930 1,006 2,331 1,660 Unlike physician data, productivity and compensation less aligned/indexed between specialties 23 Resulting Environment and Challenges wrvu or other performance metrics Longevity Impact on Wage Scales Deemphasize Productivity Satisfaction Team-based care Quality Information tracking and policy development Transition planning 24 12

Current Compensation: All APPs 25 Transition Is Key 26 13

Transition Planning-Conceptual Models Base plus flat bonus 25%ile=$2,500 50%ile=$5,000 75%ile=$7,500 90%ile=$10,000 Base plus $/wrvu @ 10% Base set at 90% of target $/wrvu @ 10% of market data Base plus value incentive Base set at 90% of target 10% for value Quality Service Access Department Specific Range of awards 27 Transition Planning-Conceptual Models Ranges and Plans Urgent Care Primary Care Medicine Subspecialty Hospital Based Surgical Subspecialty Other 28 14

XYZ Medical Group Recommended Structure XYZ Medical Component Primary Care Medical Sub Surgical Sub Cardiology Urgent Care Inpatient Base Salary 90% of TCC 90% of TCC 80% of TCC 80% of TCC 70% of TCC 90% of TCC Incentive 10% of TCC 10% of TCC 20% of TCC 20% of TCC 30% of TCC 10% of TCC Total at Target 100% of TCC 100% of TCC 100% of TCC 100% of TCC 100% of TCC 100% of TCC Prod. Tiers X X X $/wrvu X Goal Based X X 29 Transitioning APP Compensation Year 1 Years 2 to 3 Years 3+ 100% Current plan Performance measure data collected and tested. Shadow reports created. Identification of wrvu and nonproductivity metrics occurs. Education and communication strategy developed. Multiple plans with similar structure 4-6 market based ranges. Incentive component introduced (same percentage of total): Productivity (wrvus) Collaborating physician goals Service Quality Satisfaction Education and Socialization Transition completed Limited number of ranges. wrvus as equal driver vs. incentive ($/unit) Standard number of components 30 15

MEDICAL GROUP EXECUTIVE AND LEADERSHIP COMPENSATION SURVEY RESULTS 31 2015 Survey Results This year, we expanded the historical Administrative Positions section of the annual AMGA Medical Group Compensation and Productivity Survey Our intent was to develop a survey with an expanded focus on executive and leadership compensation and benefits Partnered with Yaffe & Company to assist with these goals In addition to base and incentive compensation amounts, statistics have been added including earned bonus to base ratio and new positions were added to provide even more detail on leadership compensation Data are reported for leadership positions across 34 major management disciplines 32 16

2015 Survey Results: Positions Reported Chief Executive Positions Chief Executive Officer (CEO) / President Physician Chief Executive Officer (CEO) / President Non- Physician Compliance Leadership Chief Compliance Officer (CCO) Finance Leadership Chief Financial Officer (CFO) Director, Finance / Controller Director, Health Information Management Director, Payer Relations / Reimbursement Director, Revenue Cycle (Professional) Manager, Business Office Human Resources Leadership Chief Human Resources Officer (CHRO) Director, Human Resources Information Management Leadership Chief Information Officer (CIO) Chief Medical Informatics Officer (CMIO) Director, Information Technology Physician and Clinical Quality Leadership Chief Medical Officer (CMO) Chair, Primary Care / Medical Specialties Chair, Surgical Specialties Medical Director, Primary Care Medical Director, Medical Specialty Medical Director, Surgical Specialty Director, Medical Education Director, Quality Management / Performance Improvement Nursing Leadership Chief Nursing Officer (CNO) / Patient Care Executive Director, Nursing Operational Leadership Chief Operating Officer (COO) Director, Facilities Management Director of Operations / Practice Administrator Manager, Clinic Operations I (< 15 FTE providers) Manager, Clinic Operations II (15 30 FTE providers) Manager, Clinic Operations III (> 30 FTE providers) Pharmacy Leadership Chief Pharmacy Officer / VP of Pharmacy Legal Leadership In-House Legal Counsel Strategic Services Leadership Director, Marketing / Public Relations / Communications Director, Strategy / Business Development 33 2015 Survey Results: Demographics By Group Size Demographics Groups Percent of Group Total Number of Incumbents Percent of Incumbent Total Fewer than 50 11 16.9% 90 5.7% 51 to 100 10 15.4% 140 8.9% 101 to 300 19 29.2% 301 19.1% More than 300 25 38.5% 1,043 66.3% By Geographic Region Eastern 9 13.8% 157 10.0% Northern 25 38.5% 918 58.3% Southern 14 21.5% 239 15.2% Western 17 26.2% 260 16.5% By Type of Group Independent 36 56.3% 601 38.7% System Affiliated 28 43.8% 952 61.3% Total 65 1,574 65 participating organizations 1,574 unique data points reported 56% independent groups 44% systemaffiliated groups 34 17

2015 Survey Results: C-Suite Changes Median Total Cash Compensation 2013-2015 2014-2015 Percent 2013-2015 Percent 2013-2015 Dollar Executive Position 2015 2014 Change 2013 Change Change Chief Executive Officer (CEO) / President Physician 625,000 625,194 0.0% 589,639 6.0% 35,361 Chief Executive Officer (CEO) / President Non-Physician Chief Compliance Officer (CCO) 429,511 414,286 3.7% 400,000 7.4% 29,511 188,106 169,002 11.3% 159,350 18.0% 28,756 Chief Financial Officer (CFO) 276,026 297,878-7.3% 281,957-2.1% -5,931 Chief Information Officer (CIO) 285,089 243,655 17.0% 222,910 27.9% 62,179 Chief Medical Officer (CMO) 449,369 401,352 12.0% 365,606 22.9% 83,763 Chief Nursing Officer (CNO) / Patient Care Executive 260,778 263,758-1.1% 210,017 24.2% 50,761 Chief Operating Officer (COO) 308,963 298,891 3.4% 263,437 17.3% 45,526 35 2015 Survey Results Chief Executive Officer (CEO) / President Non-Physician (5090) Total Cash Compensation Number Number of of Group Incumbent 90th 75th 25th Standard Responses Responses Percentile Percentile Percentile Deviation Median Mean Overall 32 35 717,540 543,425 429,511 349,001 480,767 245,030 Size of Group 1 to 50 8 8 386,000 370,475 329,652 214,350 298,426 91,882 51 to 100 7 7 493,822 453,155 389,173 364,048 398,947 87,915 101 to 300 7 7 599,972 552,251 486,300 307,509 448,143 157,027 More than 300 10 13 1,054,533 748,447 534,848 470,720 654,601 299,277 Base Compensation Number Number of of Group Incumbent 90th 75th 25th Standard Responses Responses Percentile Percentile Percentile Deviation Median Mean Overall 32 35 518,708 438,699 350,000 300,000 382,279 171,672 Size of Group 1 to 50 8 8 352,000 332,500 254,652 187,500 258,038 90,697 51 to 100 7 7 363,744 345,920 310,732 293,000 315,480 42,159 101 to 300 7 7 517,472 497,501 412,600 287,509 394,829 115,110 More than 300 10 13 708,758 470,720 433,500 375,000 487,945 214,728 Region Earned Bonus Compensation Number Number of of Group Incumbent 90th 75th 25th Standard Responses Responses Percentile Percentile Percentile Deviation Median Mean Overall 26 29 242,953 176,800 72,000 35,800 118,865 131,018 Size of Group 1 to 50 6 6 116,150 36,925 27,900 20,000 53,850 69,748 51 to 100 6 6 205,078 152,210 74,221 36,754 97,378 90,034 101 to 300 5 5 119,480 73,700 72,000 40,000 74,640 45,460 More than 300 9 12 423,383 239,086 117,633 49,231 180,544 171,612 Region Earned Bonus to Base Ratio Number Number of of Group Incumbent 75th 25th Standard Responses Responses Percentile Percentile Deviation Median Mean Overall 26 29 42.5% 19.5% 11.3% 31.0% 30.4% Group size stratification A new ratio of earned bonus to base was added this year Organizational philosophy on base versus incentive compensation varies Payouts of incentive bonus year-to-year can also vary Consider all three elements with emphasis on total cash compensation earned when benchmarking pay 36 18

2015 Survey Results Incumbent Incumbent Incumbent Positions Count Median Count Median Count Median Chief Operating Officer (COO) Base Compensation Bonus Compensation Total Compensation Operational Leadership 45 269,200 34 35,330 45 308,963 Director, Facilities Management 33 120,806 24 14,635 33 134,134 Director of Operations / Practice Administrator 130 137,395 109 16,800 130 150,207 Manager, Clinic Operations I (< 15 FTE providers) 138 73,100 116 5,820 138 78,538 Manager, Clinic Operations II (15 30 FTE providers) 193 78,853 139 6,870 193 82,852 Manager, Clinic Operations III (> 30 FTE providers) 77 109,138 62 10,070 77 115,959 Clinic leadership positions were stratified based on number of providers at the practice location Cash compensation amounts only differed slightly between Manager, Clinic Operations I and II The results for Manager, Clinic Operations III may suggest that for sites with >30 providers, it is possible the position is approaching director level 37 2015 Survey Results % of Average Number of Number of Incumbents Max Bonus Group Incumbent Eligible for Opportunity Responses Responses Short-Term as % of Positions to STI to STI Bonus Base Salary Chief Executive Positions Chief Executive Officer (CEO) / President Physician 30 33 94% 37% Chief Executive Officer (CEO) / President Non-Physician 27 30 90% 58% Finance Leadership Chief Financial Officer (CFO) 42 50 84% 27% Director, Finance / Controller 41 45 82% 25% Director, Health Information Management 13 13 77% 16% Director, Payer Relations / Reimbursement 14 15 67% 17% Director, Revenue Cycle (Professional) 29 30 90% 17% This table provides a summary of Short-Term Incentive (STI) or bonus opportunity across a sampling of positions In the Finance Leadership category, for example, most incumbents from reporting organizations were bonus eligible The levels of average maximum incentive opportunity increase by level, as expected Manager, Business Office 15 23 70% 10% Human Resources Leadership Chief Human Resources Officer (CHRO) 26 26 85% 25% Director, Human Resources 33 39 72% 22% 38 19

Executive Benefits: SERPs Number of Group Responses to Supp Percent Offering Supplemental Exective Positions Exec. Ret. Retirement Plan Chief Executive Officer (CEO) / President Physician 18 33% Chief Executive Officer (CEO) / President Non-Physician 15 0% Chief Compliance Officer (CCO) 12 17% Chief Financial Officer (CFO) 28 25% Chief Human Resources Officer (CHRO) 20 20% Chief Information Officer (CIO) 18 22% Chief Medical Informatics Officer (CMIO) 7 14% Chief Medical Officer (CMO) 19 21% Chief Nursing Officer (CNO) / Patient Care Executive 8 38% Chief Operating Officer (COO) Supplemental Executive Retirement Plan 24 17% 39 Executive Compensation Best Practices When using benchmarking data, make position matches based on job duties and not primarily based on title Establish your compensation philosophy up-front, including perspective on base versus bonus or incentive compensation Consider total cash compensation, with consideration of likely bonus compensation earned, when setting your compensation philosophy Adopt defensible rationale regarding use of national versus regional data or application of locality-based cost-of-living adjustments Generally, use multiple data sources for your analysis 40 20

Questions 41 21