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Remuneration as a strategy to improve service quality, cost-effectiveness, and organizational performance of private hospitals
Nur Hidayaha,
Corresponding author
, Arlina Dewia, Ekorini Listiowatib
a Hospital Management, Postgraduate Program, Universitas Muhammadiyah Yogyakarta, Yogyakarta, Indonesia
b Faculty of Medicine and Health Sciences, Universitas Muhammdiyah Yogyakarta, Yogyakarta, Indonesia
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    "textoCompleto" => "<span class="elsevierStyleSections"><span id="sec0005" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0035">Introduction</span><p id="par0005" class="elsevierStylePara elsevierViewall">For the last decade&#44; Indonesia has been implementing a new remuneration system based on the Decree of the Minister of Finance number 165&#47;KMK&#46;05&#47;2008 Across the healthcare system&#46; However&#44; studies showed that the medical staff and nurses did not satisfaction into the financial compensation or remuneration classification system&#46; Furthermore&#44; remuneration affected job satisfaction and employee performance&#46;<a class="elsevierStyleCrossRefs" href="#bib0100"><span class="elsevierStyleSup">1&#44;2</span></a></p><p id="par0010" class="elsevierStylePara elsevierViewall">Globally&#44; several western countries have been experiencing in arranging the compensation&#39;s payment based on performance&#46; In the US&#44; quality-based compensation arrangements form the basis of US health services&#46; For all types of health care providers in the US have formed a formula that consists of basic compensation and additional compensation based on the quality and cost-effectiveness of service delivery&#46; This additional compensation based on measurements of clinical performance&#44; which emphasizes service quality&#46;<a class="elsevierStyleCrossRef" href="#bib0110"><span class="elsevierStyleSup">3</span></a></p><p id="par0015" class="elsevierStylePara elsevierViewall">Dayan and research results showed that 65&#37; significantly compensation&#44; salaries&#44; and rewards affect employee performance&#46;<a class="elsevierStyleCrossRef" href="#bib0115"><span class="elsevierStyleSup">4</span></a> To improve the efficiency of health services&#44; some governments have changed their financial compensation or remunerasion system since the 20th century&#44; generally with a fixed budgetary framework&#46; This change in the remuneration system makes hospitals more competitive&#44; with higher cost-effectiveness and higher service production volumes&#46;<a class="elsevierStyleCrossRef" href="#bib0120"><span class="elsevierStyleSup">5</span></a> Echevin and Fortin analyzed the effect of remuneration on outcomes for patients&#46;<a class="elsevierStyleCrossRef" href="#bib0125"><span class="elsevierStyleSup">6</span></a> Financial incentives in the remuneration system may produce changes for clinical activities that have an impact on patient outcomes&#46;<a class="elsevierStyleCrossRef" href="#bib0130"><span class="elsevierStyleSup">7</span></a> Study about remuneration in private hospitals in Indonesia is still a few&#46; Mostly&#44; private hospitals use fees for service to physicians&#46; So&#44; this study endeavours to fill the lack of research in the remuneration system&#44; especially to analyze the impact of the remuneration on service quality&#44; cost-effectiveness&#44; and organizational performance&#46;</p></span><span id="sec0010" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0040">Method</span><p id="par0020" class="elsevierStylePara elsevierViewall">This study used quantitative research with a cross-sectional design &#8211; data collection using online questionnaires&#46; The sample was 163 people who return completed questioners from 58 hospitals of Muhammadiyah and Aisyiyah in Indonesia &#40;&#46; The total amount of HMAI is 115&#46; So&#44; to collect the data&#44; the researchers used a convenient sampling technic&#46; Data analysis employed an alternative equation model structure&#44; namely Partial Least Square&#46;</p></span><span id="sec0015" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0045">Results</span><p id="par0025" class="elsevierStylePara elsevierViewall">The characteristics of respondents need to be presented before describing the results of the research to support that the sample used is right on target&#46; <a class="elsevierStyleCrossRef" href="#tbl0005">Table 1</a> shows the ages&#44; gender&#44; education&#44; job&#44; employee status&#44; and hospital types&#46;</p><elsevierMultimedia ident="tbl0005"></elsevierMultimedia><p id="par0030" class="elsevierStylePara elsevierViewall">Based on <a class="elsevierStyleCrossRef" href="#tbl0005">Table 1</a>&#44; the respondent&#39;s age range is up to 20 until 60 years&#44; most respondents aged<span class="elsevierStyleHsp" style=""></span>&#62;<span class="elsevierStyleHsp" style=""></span>30&#8211;40 years&#46; The most respondent is women&#46; The education of the respondents is undergraduate and profession that more dominant than others&#46; The job of the respondents is very diverse&#59; the most are other than doctor&#44; nurse&#44; pharmacist&#44; and midwife&#46; According to the type of hospital&#44; the most is C&#44; then D and the fewest is B&#46; Determination of the type of hospital-based on the number of specialist doctors&#46;</p><span id="sec0020" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0050">R square value</span><p id="par0035" class="elsevierStylePara elsevierViewall">R Square Value shows the remuneration system can explain 41&#46;1&#37; of the cost-effectiveness&#44; 44&#46;7&#37; of the service quality&#44; 40&#46;2&#37; of the organizational performance&#44; variable&#46; So&#44; 58&#46;9&#37; of the cost-effectiveness&#44; 59&#46;8&#37; of the organizational performance&#44; and 55&#46;3&#37; of the service quality variable explained by other variables that not included in the study&#46;</p></span><span id="sec0025" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0055">Path coefficient value in the inner model</span><p id="par0040" class="elsevierStylePara elsevierViewall"><a class="elsevierStyleCrossRef" href="#tbl0010">Table 2</a> shows that all value of T Statistics is higher than T Table &#40;1&#46;96&#41;&#44; and <span class="elsevierStyleItalic">p</span>-value<span class="elsevierStyleHsp" style=""></span>&#62;<span class="elsevierStyleHsp" style=""></span>0&#46;05&#46; It proves that remuneration has a positive and significant effect on service quality&#44; cost-effectiveness&#44; and organizational performance &#8211; the magnitude of the effect&#44; respectively 66&#46;8&#37;&#44; 64&#46;1&#37;&#44; and 63&#46;4&#37;&#46;</p><elsevierMultimedia ident="tbl0010"></elsevierMultimedia></span></span><span id="sec0030" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0060">Discussion</span><p id="par0045" class="elsevierStylePara elsevierViewall">The results of this study indicate that the remuneration system has a significant effect on service quality&#44; cost-effectiveness&#44; and organizational performance&#44; there was no difference between men and women&#44; young and old in determining the effect of remuneration on employee behaviour&#46; Also&#44; there was no influence on the type of hospital&#46;<a class="elsevierStyleCrossRef" href="#bib0135"><span class="elsevierStyleSup">8</span></a> According to a resource-based viewpoint&#44; hospital remuneration and image can attract more outstanding medical professionals in labour market&#46;<a class="elsevierStyleCrossRefs" href="#bib0140"><span class="elsevierStyleSup">9&#8211;11</span></a> Remuneration for services has implications for a commitment to ensure their quality&#46; Professional organizations need to formulate clear strategies to build and add remuneration for professional services&#46;<a class="elsevierStyleCrossRef" href="#bib0155"><span class="elsevierStyleSup">12</span></a> One study in Manna Bengkulu District showed that specialist doctor satisfaction was still low&#46; The study provides recommendations to improve compensation policies for specialist doctors&#46;<a class="elsevierStyleCrossRef" href="#bib0160"><span class="elsevierStyleSup">13</span></a> Most hospitals pay specialists on a schedule-based basis and submitted as claims for reimbursement&#46;<a class="elsevierStyleCrossRef" href="#bib0110"><span class="elsevierStyleSup">3</span></a></p><p id="par0050" class="elsevierStylePara elsevierViewall">According to Giannini&#44; it is essential to implement an appropriate assessment system that has an integrated effect on customer satisfaction&#44; contributions from health staff&#44; and overall organizational performance&#46; An integrated performance appraisal of all organizations and their employees proves vital support for monitoring strategic variables&#46; Then&#44; combining them in the goals of effectiveness&#44; efficiency&#44; quality&#44; and individual performance to improve the proper functioning of health care organizations&#46;<a class="elsevierStyleCrossRef" href="#bib0165"><span class="elsevierStyleSup">14</span></a> Practices of human resources affect financial outcomes&#44; organizational outcomes&#44; and human resource outcomes&#46; Job satisfaction is a moderating effect between human resource practice and human resource outcomes&#46;<a class="elsevierStyleCrossRef" href="#bib0170"><span class="elsevierStyleSup">15</span></a> Outcomes prove the measure of performance&#46;<a class="elsevierStyleCrossRef" href="#bib0110"><span class="elsevierStyleSup">3</span></a> In general&#44; implementing the remuneration improve individual performance and organizational performance&#46;<a class="elsevierStyleCrossRefs" href="#bib0105"><span class="elsevierStyleSup">2&#44;16</span></a></p><p id="par0055" class="elsevierStylePara elsevierViewall">Organizations maintain their position in the labour market by paying attention to personnel needed by hospitals&#46; They also implement a suitable remuneration system and fringe benefits that they use to retain their employees and can increase employee satisfaction and loyalty&#46;<a class="elsevierStyleCrossRef" href="#bib0180"><span class="elsevierStyleSup">17</span></a></p><p id="par0060" class="elsevierStylePara elsevierViewall">Remuneration should improve the quality of health services&#44; and the pay-for-performance programme can be adapted to the specific situation of the hospital&#46; Therefore&#44; it has a significant effect on the quality of health services&#46;<a class="elsevierStyleCrossRef" href="#bib0185"><span class="elsevierStyleSup">18</span></a> Hospital quality determines the number of patients and doctors&#46; Quality improvement requires expensive effort&#44;<a class="elsevierStyleCrossRef" href="#bib0135"><span class="elsevierStyleSup">8</span></a> including to pay employee remuneration&#46;</p><p id="par0065" class="elsevierStylePara elsevierViewall">When the efficiency of the hospital&#39;s internal customers increased substantially&#44; then external customer satisfaction dramatically increased&#46;<a class="elsevierStyleCrossRef" href="#bib0190"><span class="elsevierStyleSup">19</span></a> Making hospital personnel work with the highest productivity positively influences overall hospital performance and increases the level of patient satisfaction&#46; Hospitals will prefer an increase in the level of customer satisfaction in competitive conditions&#46; Hospital staff satisfaction triggers the hospital to be preferred by customers indirectly&#46;<a class="elsevierStyleCrossRef" href="#bib0190"><span class="elsevierStyleSup">19</span></a></p><p id="par0070" class="elsevierStylePara elsevierViewall">Cost-effectiveness is one of the goals of the remuneration system&#46; Cost-effectiveness is the use of appropriate costs for the objectives set&#46; It avoids waste because waste results in using costs for activities or things that are not important&#46; From the research results&#44; the hospital instilled a culture of saving in working for all employees&#46; For further research&#44; it is necessary to formulate steps in developing a remuneration system that can improve service quality&#44; cost-effectiveness&#44; organizational performance&#44; and the formulation of remuneration&#46;</p></span><span id="sec0035" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0065">Conclusion</span><p id="par0075" class="elsevierStylePara elsevierViewall">Based on the results of research and discussion&#44; the remuneration system had a positive and significant effect on service quality&#44; cost-effectiveness&#44; and organizational performance&#46; The implication of the study recommends the hospital to improve the remuneration system in order to have higher service quality&#44; organizational performance&#44; and cost-effectiveness&#46; It is necessary to formulate a remuneration system that is suitable for each hospital&#46; The remuneration should be suitable for the specific characteristics of the hospital&#46; Steps can be arranged to develop a remuneration system and components that form a flexible remuneration system that can be applied in various hospitals with certain adjustments according to hospital conditions&#46;</p></span><span id="sec0045" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0070">Acknowledgements</span><p id="par0085" class="elsevierStylePara elsevierViewall">The authors wish to convey their gratitude to the University of Muhammadiyah Yogyakarta through the Publication and Community Service Research Institute &#40;LP3M&#41;&#44; which has provided financial support for this research&#46;</p></span><span id="sec0040" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0075">Conflict of interest</span><p id="par0090" class="elsevierStylePara elsevierViewall">The authors declare no conflict of interest&#46;</p></span></span>"
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        "resumen" => "<span id="abst0005" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0010">Objective</span><p id="spar0005" class="elsevierStyleSimplePara elsevierViewall">The study aimed to prove the effect of remuneration on health service quality&#44; cost-effective&#44; and organizational performance of private hospitals&#46;</p></span> <span id="abst0010" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0015">Method</span><p id="spar0010" class="elsevierStyleSimplePara elsevierViewall">The design of the research was a quantitative method with a cross-sectional survey&#46; Questioners were delivered online to the population target &#8211; the employee of 115 Muhammadiyah and Aisyiyah Hospitals in Indonesia&#46; The samples were 163 people from 58 hospitals who returned the completed questionnaire&#46; Sampling employed convenience technic&#46; Data analyses used Partial Least Square &#40;PLS&#41; as a Structural Equation Model alternative&#46;</p></span> <span id="abst0015" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0020">Results</span><p id="spar0015" class="elsevierStyleSimplePara elsevierViewall">Sew the financial compensation effected on quality health service&#44; cost-effectiveness&#44; and organizational performance&#46;</p></span> <span id="abst0020" class="elsevierStyleSection elsevierViewall"><span class="elsevierStyleSectionTitle" id="sect0025">Conclusion</span><p id="spar0020" class="elsevierStyleSimplePara elsevierViewall">The hospital should utilize the remuneration strategy to improve the health service&#44; cost-effective&#44; and organizational performance&#46;</p></span>"
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