JRSSEM 2023, Vol. 02 No. 9, 1989 – 1997

E-ISSN: 2807 - 6311, P-ISSN: 2807 - 6494

DOI : 10.59141/jrssem.v2i09.418 https://jrssem.publikasiindonesia.id/index.php/jrssem

THE ROLE OF REMUNERATION IN IMPROVING HOSPITAL

PERFORMANCE

Layli Rahmawati

1

Mardiati Nadjib

2

1

Postgraduate Faculty of Public Health, University of Indonesia

2

Department of Health Policy Administration Faculty of Public Health

*

Email: laylirahmawati@gmail.com, mardiatinadjib@gmail.com

*Correspondence: laylirahmawati@gmail.com

Submitted

: March 04

th

2023

Revised

: April 12

th

2023

Accepted

: April 25

th

2023

Abstract: The management of the hospital business unit is unique because apart from being a

business unit, the hospital business also has a social mission. However, the performance of this

hospital is also influenced by the management of the hospital, one of which is remuneration. This

study aims to determine the role of remuneration in improving hospital performance. This study

uses a literature review research method, while the data collection technique is carried out by

exploring journals and other information relevant to the study. The results show that remuneration

policies play a role in building a solid work team, supporting business strategies in carrying out the

hospital's vision and mission, improving service performance and hospital financial performance,

and spurring employee motivation to have a high commitment to work. Fulfill the rights and

obligations of employees and hospitals, which has an impact on increasing Hospital performance

and income.

Keywords: Remuneration; Performance; Hospital.

Layli Rahmawati

1

Mardiati Nadjib

2

| 1990

INTRODUCTION

The hospital is an institution that

provides top healing services according to

Minister of Health Regulation number 3 of

2020 where emergency, outpatient, and

inpatient assistance is available. The main

function of the hospital is to provide health

services to medical personnel, while

administrative and technical services that

are not directly related to health services

are provided by non-health workers. The

existence of medical personnel and non-

medical personnel as workers perform a

very fundamental character in hospital

organizations and is an integral part of

hospital management, which is one of the

key variable factors in determining hospital

success (Nova, 2010).

Hospital human resources that play a

major role in health services are functional

medical staff (SMF) which includes general

practitioners, specialists, and nurses who

have an important role in determining the

direction of the quality of health services

provided. Doctors and nurses are entitled

to income for health services that have

been provided to patients (Soetisna et al.,

2013). In addition, a qualified workforce is

also needed so that workers can play their

role as executives who are experts in

organizational tasks. This quality covers

various aspects of the discipline,

knowledge, expertise, dedication, ideas,

creativity, and responsibility (Turmidzi,

2019).

Employee performance needs to be

given appropriate appreciation so that it

can be a motivator for employees to work

optimally. According to (Luh & Sayang,

2019), the work of each employee will

increase if balanced with good

remuneration and their respective jobs.

Remuneration has the meaning of

"something" received by employees in

return for the contribution they have made

to the organization where they work

(Nurhayati & Supardi, 2020). Remuneration

has a broader meaning than salary, because

it includes all forms of rewards, both in the

form of money and indirect, and those that

are routine or non-routine. Direct rewards

consist of salaries/wages, position

allowances, special allowances, bonuses

that are linked or not associated with work

performance and organizational

performance, intensive achievement

rewards, and various types of assistance

provided regularly. Indirect rewards consist

of facilities, health, pensions, salaries during

disaster compensation leave, and so on

(Surya, 2004).

Based on this presentation, researchers

are interested in finding out more by

conducting a study entitled "The Role of

Remuneration in Improving Hospital

Performance".

Although there have been several

previous studies on the role of

remuneration in improving hospital

performance, there are still inadequate

research gaps, especially in the Indonesian

context. Several previous studies were

more closed in developed countries, while

research in developing countries like

Indonesia is still minimal.

Research on the role of remuneration

in improving hospital performance is very

important given the increasingly tight

competition between hospitals in

Indonesia. In improving hospital

performance, management must consider

1991 | The Role of Remuneration In Improving Hospital Performance

remuneration as a key factor in

encouraging employee performance and

increasing patient satisfaction.

The purpose of this study is to

determine the extent of the role of

remuneration in improving hospital

performance in Indonesia. This research will

try to identify remuneration factors that

affect employee performance and patient

satisfaction levels and explain how these

factors can be applied in the context of

hospitals in Indonesia.

The results of this study are expected

to provide a significant contribution to the

development of hospital management in

Indonesia. By knowing the remuneration

factors that affect employee performance

and patient satisfaction levels, hospital

management can design an effective and

balanced remuneration system. In addition,

this research can also be a reference for

future researchers who wish to conduct

similar research.

This research is relatively new because

it focuses on the role of remuneration in

improving hospital performance in

Indonesia, which is a developing country

with different characteristics and

challenges compared to developed

countries. In addition, this study will also

explore remuneration factors that have not

been studied much before, such as

performance incentives, employee benefits

and non-financial benefits.

MATERIALS AND METHODS

This study used the research method of

literature review. The literature review

research method is a systematic, explicit,

and reproducible research method to

identify, evaluate and synthesize research

works and thoughts that have been

produced by researchers and practitioners

(Ulhaq & Rahmayanti, 2020). While data

collection techniques are carried out by

exploring journals and other information

relevant to the study.

In investigating the role of

remuneration in improving hospital

performance, there are several data

collection techniques that can be used. First

of all, an employee survey can be

conducted to collect employee perceptions

about the effect of the remuneration

system on hospital performance. Interviews

with hospital leaders, financial managers,

HR managers and employees can also be

conducted to get a deeper picture of the

role of remuneration in improving hospital

performance.

In addition, analysis of hospital

performance data can be carried out by

collecting data such as the number of

patients served, length of stay, patient

waiting time, level of patient satisfaction,

and others that can be linked to the

remuneration system. Literature studies can

also be carried out by collecting literature

related to remuneration systems in

improving hospital performance, both from

journals, books and online sources.

After the data is collected, there are

several analysis techniques that can be

done. First, correlation analysis can be used

to see the relationship between the

remuneration system and hospital

performance. For example, we can analyze

the correlation between employee salary

levels and patient satisfaction. Then a

regression analysis can be carried out to

see how much influence the remuneration

Layli Rahmawati

1

Mardiati Nadjib

2

| 1992

system variables have on hospital

performance. In this case, hospital

performance variables can be measured

using data such as length of stay, patient

waiting time, or patient satisfaction levels.

Furthermore, a comparative analysis

can be carried out by comparing the

performance of the hospital before and

after the implementation of the new

remuneration system. This can help see

whether changes to the remuneration

system have a positive impact on hospital

performance. Finally, descriptive statistical

analysis can be used to summarize

remuneration system data and hospital

performance in the form of tables, graphs

or diagrams. This can help visualize data

and make conclusions easier to

understand.

RESULTS AND DISCUSSION

Fair and satisfactory compensation is

fundamental to the continuity of hospital

operations, as all staff in hospitals seek

equality in compensation. However, if

workers are not happy with the

compensation, it can lead to the bad

character in the agency and hurt workers'

determination, which in essence dampens

workers' performance.

This research is in line with the

statement of Noe et al. (2014) that

remuneration can also motivate employees,

and improve employee performance. The

findings of this study are also supported by

research by Berliana et al. (2018), which

concluded that remuneration

compensation affects job satisfaction,

remuneration compensation, and job

satisfaction affects employee performance;

Remuneration compensation has a

dominant influence. From the information

on indicators representing remuneration

variables, it was found that there are three

dominant indicators representing

remuneration, namely salary, awards, and

performance allowances.

Motivation plays an integral role in

many of the exciting challenges facing

healthcare workers today. Motivation

theory classifies motivational sources into

those that are intrinsic and those that are

extrinsic work. Thus, an exploration of the

factors motivating today's healthcare

workforce can yield valuable insights into

the many challenges facing modern

hospitals. Meeting the needs and achieving

the goals of both employees and the

organization is the cornerstone of job

satisfaction and this is especially important

for management, as it correlates with

improved quality of services provided

(Lambrou et al., 2010).

The results of (Mendes et al., 2017)

research at Parirenyatwa Hospital show that

there is a positive relationship between

remuneration and the efficiency of officers'

medical services, showing that

remuneration is a source of motivation for

the efficiency of medical workers at

Parirenyatwa Hospital. This is in line with

the findings stating that there is a strong

relationship between remuneration and the

efficiency of medical personnel.

Remuneration

Remuneration means "something" that

employees receive in return for

contributions they have made to the

organization they work for either directly or

indirectly. Direct remuneration consists of

salaries/wages, position allowances, special

1993 | The Role of Remuneration In Improving Hospital Performance

allowances, bonuses related or unrelated to

work, performance, and performance of the

organization, in s ent if as merit awards, and

various types of assistance provided

periodically. Indirect compensation

consists of facilities, health, pension funds,

salaries during disaster leave, and so on

(Diyanto & Peristiowati, 2022).

The purpose of the remuneration

system in general is to attract, retain and

motivate quality human resources, and for

that human resource management needs

to pay attention to the availability and

demand of human resources.

In addition to the above, the purpose

of the remuneration is to attract, retain and

motivate quality human resources, and for

that human resource management needs

to pay attention to the availability and

demand of human resources. If there is an

excess of labor supply, the level of

compensation provided is relatively low.

On the other hand, if there is excess

demand, the rate of return is relatively high.

The provision of remuneration is

related to the requirements that must be

met by employees in the positions they

occupy, to create a balance between output

and input. The more courageous an

institution is to provide high remuneration

can be used as a benchmark that the more

successful the institution is in building the

work performance of its employees

because the provision of high

remuneration is only possible if the

institution has a high enough income and

is willing to provide high remuneration in

the hope that the institution will be more

advanced. Providing better remuneration

will encourage employees to work more

productively (Diyanto & Peristiowati, 2022).

Performance

Healthcare organizations face major

challenges to keep healthcare accessible

and affordable. This requires them to

change and improve their performance, to

do so the organization must improve the

performance of its employees.

Performance is the result of work and

work behavior that has been achieved in

completing the tasks and responsibilities

given in a certain period. And leadership,

job satisfaction, work motivation, and

incentives together have a positive and

significant effect on performance.

The results of this study show that

competence, training, and motivation

partially and simultaneously have a positive

and significant effect on employee

performance (Rivaldo Yandra, 2022).

The higher and more appropriate

competence of employees in working by

their fields will be able to improve

employee performance

Competency is the capacity that exists

in a person that makes the person able to

fulfill what is required by the work in an

organization so that the organization can

achieve the expected results". Employee

competence in the field of work will cause

the work done to be done faster, and with

more quality, thus causing increased

performance. If employee competence is

more by work, the training provided is

more effective and employees have strong

motivation, it will significantly improve

employee performance therefore

employee performance is an important

factor that must be considered by

companies to be able to thrive in fierce

competition and uncertain conditions

(Pratama & Riana, 2022).

Layli Rahmawati

1

Mardiati Nadjib

2

| 1994

Another thing that can affect

performance is compensation,

remuneration, and job satisfaction,

including career development (Roza et al.,

2022).

Hospital

Hospitals by Minister of Health

Regulation No. 3 of 2020 are health service

institutions that provide plenary health

services that provide inpatient, outpatient,

and emergency services whose services are

provided by doctors, nurses, and other

health experts.

Hospitals established by the Central

Government and Regional Governments

must be in the form of Technical

Implementation Units from Agencies in

charge of the health sector, or certain

Agencies with the management of Public

Service Agencies or Regional Public Service

Agencies by the provisions of laws and

regulations.

Health services provided by public

hospitals consist of at least the following:

a. medical services and medical

support;

b. nursing and midwifery services; and

c. Nonmedical Services.

Human resources at public hospitals in

the form of permanent personnel include:

a. medical personnel;

b. clinical psychology personnel;

c. nursing personnel;

d. midwifery personnel;

e. pharmaceutical personnel;

f. public health workers;

g. environmental health workers;

h. nutritional labor;

i. physical therapy personnel;

j. medical technicians;

k. biomedical engineering

personnel; l. other health workers; and m.

non-health personnel.

The followings are the duties and

functions of the hospital:

 Implementation of treatment and

health recovery services by hospital

service standards.

 Maintenance and improvement of

individual health through complete

second and third-level health

services according to medical

needs; appropriate

 Implementation of education and

training of human resources to

increase the ability to provide

health services; and

 Implementation of research and

development and screening of

technology in the health sector in

the context of improving health

services by taking into account the

ethics of science in the health

sector.

Public hospitals are usually facilities

that are easily found in a country, with very

large inpatient capacity for intensive or

long-term care. This type of hospital is also

equipped with surgical facilities, delivery

rooms, intensive care rooms, radiology,

laboratories, and so on. But the

completeness of this facility may vary

according to the ability of the organizer

Layli Rahmawati

1

Mardiati Nadjib

2

|

1995

DOI : 10.59141/jrssem.v2i09.418 https://jrssem.publikasiindonesia.id/index.php/jrssem

CONCLUSIONS

Fulfilling the rights and obligations of

employees In a study on remuneration, it

was found that improvements to the

remuneration system positively impacted

nurse performance and the quality of

subsequent health services.

Remuneration received by employees

must be equivalent to what is given by

employees to the organization, internal

equity or internal justice in the sense of

fairness between the weight of work and

the rewards received, and external equality

or external justice in the sense of fairness of

rewards received by employees in their

organization compared to other

organizations that have equality.

Hospitals must utilize remuneration

strategies to improve health services, save

costs, and improve organizational

Note after duplicate ( n=98 )

Thickrecords are identified through database search by keywords, remumeration,

performance, hospital

Gogle scholar = 248, pubmed = 13, science direct = 9

Notes after filtering ( n = 36 )

Full-text articles are assessed for

notability ( n = 9 )

Records that include n= 7

Excluded records by filtering

headings ( n = 62 )

Excluded records n= 25

Full text excluded n= 2, excluding

the performance of hospital

employees

Included

Eligibility

Screening

Identification

Layli Rahmawati

1

Mardiati Nadjib

2

| 1996

performance.

The remuneration system in the DKI

local government uses a partial

remuneration system because for civil

servants the remuneration is still borne by

the APBD, the components that are still

borne by the APBD are salaries and some

kindergartens.

Remuneration is seen as an instrument

of behavioral control or a learning

mechanism. With the provision of

remuneration, it is expected to control or

change employee behavior in service to

customers and make employees learn to

improve service to customers to become

loyal customers.

The determination of the incentive

system should indeed be left to the

hospital. This makes employees more

motivated to be more involved in the

system and more motivated to innovate so

that it has more value which is important

for the hospital.

REFERENCES

Diyanto, Y. K., & Peristiowati, Y. (2022).

Perception Analysis and Remuneration

on Job Satisfaction of Health Officers

at Nonggunong Public Health Center,

Sumenep Regency.

Journal for Quality

in Public Health

,

5

(2), 417–424.

Hidayah, N., Dewi, A., & Listiowati, E. (2020).

Remuneration as a strategy to

improve service quality, cost-

effectiveness, and organizational

performance of private hospitals.

Enfermería Clínica

,

30

, 179–182.

Lambrou, P., Kontodimopoulos, N., &

Niakas, D. (2010). Motivation and job

satisfaction among medical and

nursing staff in a Cyprus public

general hospital.

Human Resources for

Health

,

8

(1), 1–9.

Luh, N., & Sayang, W. (2019).

Dampak

remunerasi terhadap peningkatan

kinerja karyawan

.

7

.

Mendes, A., Lunkes, R. J., Flach, L., &

Dalmutt Kruger, S. (2017). The

influence of remuneration on the

behavior of hospital employees in

Brazil.

Contaduría y Administración

,

62

(1), 207–221.

Nova, R. F. (2010).

Pengaruh Kualitas

Pelayanan Terhadap Kepuasan Pasien

Rawat Inap Pada Rumah Sakit Pku

Muhammadiyah Surakarta

.

Nurhayati, E., & Supardi, E. (2020).

Sistem

remunerates dan kualitas kinerja

pegawai (remuneration system and

the quality of employees ’

performance)

.

5

(2), 140–153.

https://doi.org/10.17509/jpm.v4i2.180

08.

Pratama, O. S., & Riana, N. L. K. M. P. (2022).

Pengaruh Kompetensi, Pelatihan dan

Motivasi Terhadap Kinerja Karyawan

Selama Masa Covid-19.

Jurnal

Akuntansi, Manajemen Dan Ekonomi

,

1

(1), 137–145.

Rivaldo Yandra. (2022).

Employee

performance improvement

monograph

. Eureka Media Aksara .

1997 | The Role of Remuneration In Improving Hospital Performance

Roza, N., Supriyati, Y., & Kadir, K. (2022). The

Effect of Organizational Culture,

Career Development, Remuneration,

and Job Satisfaction on Nurse

Performance.

Hong Kong Journal of

Social Sciences

.

Soetisna, T. W., Ayuningtyas, D., Sakit, R.,

Darah, P., Kita, H., Kebijakan, D. A.,

Kesehatan, F., Universitas, M.,

Masyarakat, F. K., & Sriwijaya, U.

(2013).

Penerapan Sistem Remunerasi

dan Kinerja Pelayanan

Implementation of Remuneration

System and Service Performance

. 17–

23.

Surya, M. (2004).

Psikologi Pembelajaran

dan Pengajaran

. Pustaka Bani Quraisy.

Turmidzi, I. (2019). Konsep Pengendalian

Mutu dan Peran Manajemen Sumber

Daya Manusia Dalam Dunia Bisnis dan

Dunia Pendidikan.

Jurnal Pemikiran

Dan Pendidikan Dasar Islam

,

1

(1), 63–

100.

Ulhaq, Z. S., & Rahmayanti. (2020). Panduan

Penulisan Skripsi Literatur Review.

Fakultas Kedokteran Dan Ilmu

Kesehatan Universitas Islam Negeri

Maulana Malik Ibrahim Malang

,

53

(9),

32.

for possible open-access

publication

under the terms and conditions of the Creative

Commons Attribution (CC BY SA) license

(https://creativecommons.org/licenses/by-sa/4.0.