Pts insurance type doesn't matter for my pay as a hospital employee?

[Timeoutofmind]

Quick question.

I interviewed with a hospital.

1. They told me that my pay is based on RVUs, irrespective of the pts type of insurance. Can this be true? I don't see how they could pay me the same for seeing/injecting a Medicaid vs a commercial insurance pt?

2. Also, after two years it is no base, all productivity. It seems there is an enormous backlog of pts...maybe this is ok? Is this normal for hospital employees in pain and other specialties? I could definitely try and negotiate a base pay indefinitely too. I am a little concerned on this issue because I am not going to do much opioid prescribing at all, and even though there is a huge backlog now, this probably could affect my referral volume. (I was very upfront with them about this and administration was ok with it).

Sorry for the naive questions. This would be my first job out of fellowship.

Thanks as always for your insights. This board is great!

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[drusso]

You are having your first encounter with the artificial economics of hospital employment!

You are right! If you were running a real business seeing mostly Medicaid (high needs, high risk, high complexity) pain patients you would go broke. How do the large physician employers pull this off? Two words: Cost shifting.

RVU's were created to shield hospital employed physicians from the real economies of providing care for patients. If you knew that Medicaid reimbursement for professional services is often 1/5 of that for commercial insurance, then you would make the economically rationale decision of focusing your efforts (practicing at the top of your license) on patients with better insurance. They want you to treat "everyone the same." So the RVU represents a "blended" conversion based upon their particular payor mix.

Next, by exclusively capturing your labor (vis-a-vis an employer/employee contract relationship which is essentially grounded in the Common Law of Master/Servant relationship) they can "direct and control" your work. This is the essence of being employed: They DIRECT and CONTROL YOUR WORK. This is also how they benefit from cost-shifting: They will direct you to refer within the system, use their ancillary services, lab services, etc). And, unknown to most new physicians, hospitals get paid MORE for certain services than independently owned practices ostensibly because just OFFERING those services requires more resources. So, your job will be to "feed the machine." While in some sectors this is usually called "a monopoly" in health care it's called "integration," "alignment," or "accountability."

Inquire about their willingness to secure your professional services as an independent contractor? Finally, if the hospital group you're interviewing with is part of a large chain, consider the impact on the local economy by siphoning away profits from independently owned practices and ancillary service providers to into large corporate health care conglomerates. If you support locally owned businesses that money stays in the community and helps support a local tax base, pay for a kid's ballet lessons, etc. If those profits go to a large health care conglomerate, maybe your money (or labor) goes to supporting the purchase of some far-away hospital CEO's third vacation home.

 

[ampaphb]

Although Dave's perspective would be reasonable in an academic discussion from 30, 000 ft, it's bad advice to a new practitioner. Do what's best for you personally, not what's better for society at large.

In answer to your question, hospitals are paid differently, and so yes, they can pay you the same regardless what insurance an individual patient has. Sometimes, as Dave says, they will make it up by the number of ancillary revenue streams the care generates. Sometimes they are being paid a premium for indigent care. Don't worry about their bottom line, just yours.

Your ONLY two concerns, in addition to your base salary, should be 1) to negotiate the highest conversion factor possible. They will tell you it is a fixed number. That is a lie. 2) Negotiate the level at which your productivity bonus kicks in to be the lowest possible number of RVUs you can.

Also, do not worry about a base after two years. You will have exceeded whatever your base is, and will not need a continued guarantee. If you insist on one, your employer will 1) question your work ethic, and 2) insist that they continue to get a larger share of the revenue u generate, when you should, at that point, be at an eat what you kill stage in your earnings.

 

[101N]

If it seems to good to be true it probably is. When the federal subsidies start to hit in the next few years
clinics built on Medicaid will suffer. It's not a sustainable model.

 

[Timeoutofmind]

Excellent posts...thanks!

1. What is a desirable range for the conversion factor dollar wise?

2. Any idea how many RVUs I can expect to generate in a year coming out of fellowship? (I am fairly hardworking, but not as slick as some, and will have performed maybe around 800 injections.)

 

[Timeoutofmind]

If it seems to good to be true it probably is. When the federal subsidies start to hit in the next few years
clinics built on Medicaid will suffer. It's not a sustainable model.

I am confused...how do "clinics built on Medicaid" have anything to do with my position as a hospital employee? Are you implying that if I am seeing a large number of Medicaid pts, when the new federal subsidies are inacted, somehow my practice will be generating less revenue for the hospital (and thus they couldn't afford to keep paying me in the above agreement model)? How would these subsidies cause this to occur?

 

[gdub25]

Excellent posts...thanks!

1. What is a desirable range for the conversion factor dollar wise?

2. Any idea how many RVUs I can expect to generate in a year coming out of fellowship? (I am fairly hardworking, but not as slick as some, and will have performed maybe around 800 injections.)

The average for the Texas and Oklahoma region is $64 per RVU and 6,300 RVU per year according to the MGMA and Sullivan Coulter surveys. Nearly all hospitals use data collected by national surveys such as these to structure their physicians compensation plans. You should get a copy of this information to put yourself in good position for negotiating. The last 3 fellows that graduated from my program and went to work for a hospital system all did over 7,000 RVU their first year. This is not the norm for sure, but it's certainly possible for a guy coming out of a good fellowship and quick with procedures.

I am confused...how do "clinics built on Medicaid" have anything to do with my position as a hospital employee? Are you implying that if I am seeing a large number of Medicaid pts, when the new federal subsidies are inacted, somehow my practice will be generating less revenue for the hospital (and thus they couldn't afford to keep paying me in the above agreement model)? How would these subsidies cause this to occur?

I'm a fellow myself so I'm right there with you in looking for a job and trying to figure out how all this stuff works, however you seem to be way behind in the game. I've got a group of 3 guys that are also pain fellows and we talk on a regular basis about this stuff. We were figuring out the answers to the questions you're asking months ago, before we even started fellowship. If you don't even know what an RVU is, how it is figured, what a competitive RVU for your region is, how many RVU you could expect to generate, and how the hospital can afford to pay you like this then you are in a very bad position to evaluate an employment opportunity. I looked at a LOT of different opportunities to learn what I now know. For me it took seeing a lot of different practices and hospital employment deals before I felt like I was able to recognize a good one. I'm happy to help any way I can but I would really recommend reading up on this forum everything you can about hospital employment deals to get a basic idea of how it all works.

 

[Ducttape]

they are trying to scare you into going into a private practice model that you essentially eat what you do. there are huge advantages to doing so, but there are disadvantages to private practice too, and probably too long to expound about in a simple thread.

there is equally as great a likelihood that pure IPM practices based on insurances paying 2-3 times medicare rate will become compressed or at least severely damaged because of high deductibles, increased requirement for Prior auths, decreased coverage for procedures based on insurance company determination, etc.

"Clinics built on Medicaid" tend to rely on ancillary services to justify continued salaries and employment. for example, you see x number of patients that generate a small sum. but you do y referrals for MRI/CT in the hospital system, do z referrals to the hospital PT, do q UDS, and do a+b referrals to spine surgery. all together, you bring in so much money into the system that doesnt appear on your bottom line. additionally, most hospital based clinics rely heavily on facility fees - either HOPD or ASC - to "generate" additional income above your professional fees for doing a procedure.


please dont take gdub's comments negatively. it is March only. there is plenty of time to find a job, and to learn about how practices work. additionally, depending on where you are in the US, the market can be much more competitive and require you to know such data much sooner.

from my perspective, i started learning RVUs, models, etc about this time. some of my concurrent fellows, 5 years out, probably still dont know this information...

 

[BobBarker]

GW be nice.

I think it should be very easy to do 7000 RVU as hospital employee almost anywhere. Especially taking Medicaid. I have probably 30% Medicaid at least and our Medicaid is pretty easy to work with. They let me do stim and kypho.

They don't care about the payor source as you are generating exorbitant fees every time you are using the c arm in the HOPD billing structure.

 

[BobBarker]

edit

 

[powermd]

We were looking in to leasing our practice out to a hospital this past year, until the government slammed that door shut in November.

Based on our current payor mix (heavy MDC), we would have generated for the hospital about $135 in revenue per wRVU we worked. This, naturally, factors in both the fat hospital facility fee and absurdly low professional fee. The hospital suggested to us, in initial negotiations, a rate of $85/wRVU based on their own research. Our practice is mature, so to a large extent this rate would be well deserved. For a guy just starting out with a hospital, where the hospital system will be feeding the doc all his new business, $65-75 is a reasonable target. I would forgo a salary guarantee if you could get them to agree to that.

 

[101N]

they are trying to scare you into going into a private practice model that you essentially eat what you do. there are huge advantages to doing so, but there are disadvantages to private practice too, and probably too long to expound about in a simple thread.

there is equally as great a likelihood that pure IPM practices based on insurances paying 2-3 times medicare rate will become compressed or at least severely damaged because of high deductibles, increased requirement for Prior auths, decreased coverage for procedures based on insurance company determination, etc.

"Clinics built on Medicaid" tend to rely on ancillary services to justify continued salaries and employment. for example, you see x number of patients that generate a small sum. but you do y referrals for MRI/CT in the hospital system, do z referrals to the hospital PT, do q UDS, and do a+b referrals to spine surgery. all together, you bring in so much money into the system that doesnt appear on your bottom line. additionally, most hospital based clinics rely heavily on facility fees - either HOPD or ASC - to "generate" additional income above your professional fees for doing a procedure.


please dont take gdub's comments negatively. it is March only. there is plenty of time to find a job, and to learn about how practices work. additionally, depending on where you are in the US, the market can be much more competitive and require you to know such data much sooner.

from my perspective, i started learning RVUs, models, etc about this time. some of my concurrent fellows, 5 years out, probably still dont know this information...

Duct I am not trying to influence him/her into PP. However, I do have concerns about an admin's claim that
payer mix doesn't matter. As federal subsidies slide down CCO's are going to - rightly - slam the door on procedural
pain and expensive meds because they don't influence outcome. Moreover, the hospital setting is too expensive
an environment from which to provide behavioral health and resiliency programs for CNP. This isn't a swipe at
the employed physician model, it's a fact and it's coming.

 

[Timeoutofmind]

Thanks again all for the super helpful comments! Can't thank you enough.

Follow up question:

The current setup is that I can perform the procedures in either 1. A flouro suite in a different hospital building 10 min away that is dedicated only to pain (so scheduling should never be an issue). Or 2. An ASC at the hospital building that my office will be in (on a different floor)

This seemed ok to me. I assumed 1 is the better option? Any reason though, to push for an in office flouro suite instead of one of these two?

 

[drusso]

Duct I am not trying to influence him/her into PP. However, I do have concerns about an admin's claim that payer mix doesn't matter. As federal subsidies slide down CCO's are going to - rightly - slam the door on procedural pain and expensive meds because they don't influence outcome. Moreover, the hospital setting is too expensive an environment from which to provide behavioral health and resiliency programs for CNP. This isn't a swipe at the employed physician model, it's a fact and it's coming.

I think that what 101N wrote is the most sensible thing I've read in a long time. There comes a time when the large physician employers run out of subsidies and accounting tricks. Then what? While there are vulnerabilities to any model of care, at least in private practice one can have some control about how the spending decisions are made and the what payors one is willing to accept. Historically, hospitals have not involved their employees in these decisions.

 

[SSdoc33]

the truth is somewhere in the middle

your hospital can pay you based on RVUs because they will make a ton on facility fees and ancillary revenue, based primarily on site-of-service differential. however, there has to be some correlation of the RVU total and your net collections in a dollar value. if you bill out 10,000 RVUs and only collect 500K, then the model will not work, regardless of what they tell you. however, you will never really know how much money you collect with both professional and facility fees and income generated for the entire hospital thru referrals and ancillaries.

it will eventually come down to getting paid whatever your chairperson or administrator wants. they can and will change the rules on a whim. it is a tough pill to swallow if you really want to have control of how you practice and how much you take home.

 

[SSdoc33]

Thanks again all for the super helpful comments! Can't thank you enough.

Follow up question:

The current setup is that I can perform the procedures in either 1. A flouro suite in a different hospital building 10 min away that is dedicated only to pain (so scheduling should never be an issue). Or 2. An ASC at the hospital building that my office will be in (on a different floor)

This seemed ok to me. I assumed 1 is the better option? Any reason though, to push for an in office flouro suite instead of one of these two?

if you are only getting professional fees (rather than shares of an ASC), then do the shots at the most efficient location

 

[V-SWAG]

Anyone have any good resources (books, lectures, websites etc...) on how "all this stuff works". I will be starting my pain fellowship next year and am pretty clueless when it comes to the business side of medicine. Thanks and appreciate any help.

 

[drusso]

http://www.studentdoctor.net/2014/07/how-do-i-get-paid-a-beginners-guide-to-physician-compensation/

 

[Timeoutofmind]

So they got back to me with some numbers. What do you think about this RVU structure?

 

[Stim4me]

Money doesn't grow on trees... Hospitals are always on the chop block when state deficits are Exploding. Hospital admin always looking for community support to avoid state cuts to medicaid subsidies. Maybe your state is more fiscally sound than most. Plus incentive aca programs are done and ponzie CMS scheme is over. Hospitals are reporting less profit with quality care bundled models as well. See ASIPP recent updates if you are curious. Know the landscape before you commit to a hospital... Good luck

 

[SSdoc33]

obviously, a lot depends on where you are practice. judging by those numbers, it appears to be a place that nobody in their right mind would want to live. if they actually keep up their end on the bargain, then that is a great package. however, that is a big IF. lets just say that i'd be buying my own hawaiian island if i got paid by those RVU numbers.....

 

[drusso]

IF that's the real compensation plan, you want it cut-and-pasted into your contract with language clearly stating that it can't be changed without both parties agreeing and any change effectively re-opens the entire contract to a new negotiation....and you want plenty of notice a change to the compensation plan.

 

[DOctorJay]

you need to get specifics on that service and quality total production crap at the end too. if they're going to Press-Ganey you be prepared to lose that 10%.

you should definitely hit tier 2 your first year if working full time. stupid that your conversion factor goes down after your first bump in tier 2, they should keep it the same or increase to encourage your productivity.

is there a max compensation at all? some hospitals cap you at a certain point.

 

[BobBarker]

Where is this hospital at???? Just give me a state.
I want to use this to pump up my conversion factor!

 

[gdub25]

I looked at a bunch of hospital employment jobs, agree those are good numbers. I would for sure ask about a salary cap,especially if the place is a not for profit institution. I came across two places that had a cap, both were at 90th percentile MGMA. Those conversion factors are well above the national average so like everyone else I'm guessing it's because it's in a location that's hard to recruit people to. If that's the case and you want to try to negotiate a bit I would ask that the tier 4 conversion be bumped up. The way it is now I'd be discouraged to try and work for anything over 10k RVU. Not that $58 is all that bad, just not anywhere near the others. $64 is the average for the OK and TX region per MGMA, could maybe ask for that. On the other hand you could just be happy with what they've offered...I just tend to live by "if you don't ask you'll never know".

 

[Timeoutofmind]

Where is this hospital at???? Just give me a state.
I want to use this to pump up my conversion factor!

Wisconsin

 

[NOSfan]

** Also, make clear that if there is no wRVU assignment for a code (- the big one is conscious sedation 99144) that there is a wRVU established upfront and a mechanism in place (- ie; physician compensation committee) for determination of any potential future changes. **

 

[Yo GabbaPentin]

Wisconsin

1. Are you from Wisconsin? I can tell you from extensive experience that certain parts are similar to living in rural Alaska. Location sometimes can be worth taking less money. Only you can decide that one.

2. 7000 rvus are easy. When I tracked RVU for one year at another job, I hit mid 7000s with 8-4 hours, 4 days a week (maybe a little less). I'd hope for 7000 first year and 10000 second year.