Physician compensation advice

[unlucky87]

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Hi, as I’m looking for jobs, I have come across a compensation model called NPPB (net professional patient Billings). I’m trying to find more information on this model versus the standard RVUs. Does anyone have any experience with NPPB? Thanks in advance.

 

[nlax30]

I've heard of it but don't have any experience in it. The jobs I'm looking at are either straight salary (academic) or RVU/productivity based.

Two things I'd suggest:
1. Have a lawyer review the contract. One who has specific experience/knowledge of physician job contracts. They should be able to help with the nuances and potential 'gotchas' in the contract as well as may have some knowledge of the compensation landscape in your specific area.

2. If comfortable, maybe talk to other Cardiologists in the group you're considering joining and ask them specifics about this compensation model. Ask for specific numbers. The main job I'm looking at is pure production (based on RVUs) so I asked a couple of the guys I know there about how many RVUs they've been able to reach and I know numbers from a few others in my field in the immediate area to compare it to.

 

[Instatewaiter]

Is there any sort of gaurantee? Did they tell you a salary to expect? Office work only or in hospital?

Reading echos/nucs? How many per day? Benefits?

Big city, suburban or rural?

How long has the job been posted?

Honestly this may be a rip off . Sounds like a lot off the top.

 

[Phospholipid]

I had two offers which are based on net collections, which I believe is similar to NPPB. They are both private practices.

1) base salary + after you generate 2x yr salary, you keep 50% of your net collections
2) base salary + after you generate 1.5 million in net collection, you keep 40%, but after 2 yrs, you are straight 40% net collections without base salary

I think keeping 40-50% of net collections is reasonable, 40% on the lower end. However, I was going to go with #2, because the practice seemed better run and more efficient.

I finally ended up going with hospital employed with base salary + RVU with tier system (the more you make, the higher yr each RVU is worth) with full benefits, 401k. I prefer hospital employed if possible, less hassle, and no worries about buyin to partnership, and allows you more to focus on being a good cardiologist, rather than patients' ability to pay ..etc

 

[cardsguy2017]

I've never heard of NPPB, and if it's based off what patients get billed after insurance, that seems even more odd. I may be misunderstanding, but if a patient has a high deductible, then I guess that's great, but what if they have a low deductible/copays or reach their annual limits and insurance covers 100%? Seem atypical and more details would be great, but I agree that talking with other cardiologists working there and see what they think and how it works out.

 

[unlucky87]

I've heard of it but don't have any experience in it. The jobs I'm looking at are either straight salary (academic) or RVU/productivity based.

Two things I'd suggest:
1. Have a lawyer review the contract. One who has specific experience/knowledge of physician job contracts. They should be able to help with the nuances and potential 'gotchas' in the contract as well as may have some knowledge of the compensation landscape in your specific area.

2. If comfortable, maybe talk to other Cardiologists in the group you're considering joining and ask them specifics about this compensation model. Ask for specific numbers. The main job I'm looking at is pure production (based on RVUs) so I asked a couple of the guys I know there about how many RVUs they've been able to reach and I know numbers from a few others in my field in the immediate area to compare it to.

Thank you for your reply. I will definitely follow your advice!

 

[Instatewaiter]

I have never heard about this model too. When I asked for further explanation, this is what I was told.
If you see a pt, and bill them $100. And the insurance pays only $70 for the service you provided, you get $35 and the hospital gets $35 for overhead expenses. I have asking people at my fellowship training and searching online, but I haven’t had much luck. Now depending on sdn group to help me out.

I have never heard of NPPB to be honest but what you're describing sounds like based upon both collections and payor mix. That is a bit of a red flag especially without a gaurantee.

Assuming you collect everything you bill (which doesn't happen) lets do the math:

You can probably see at the high 25 level 4s a day if you are efficient (by time it's supposed to be 25 minutes so that would be over 10 hours of clinic). Medicare pays 96 bucks. Assuming only 4 weeks vacation -

96 (dollars per patient) x 25(pt per day) x 5 days per week x 48 weeks /2(what they take off the top)=$288k. Reading Echos will add more, possibly lots more

That assumes you are busy which with only 1 year before you eat what you kill. Probably won't be that busy. If you see half that and the other partners take all the echos, you're getting paid less than the hospitalists .

You absolutely need to know what others with the exact same model are being paid . If they won't tell you that is a deal breaker in my mind. Have others left the job? Also a red flag if others have left.

You should see if they would pay you gaurantee for 2 years that way if the job sucks you can bail and sill be able to get another job during that 2nd year.

 

[cardsguy2017]

Yeah, sounds like collections based which isn't uncommon, but has its faults as well. Definitely check if the volume is there and what YOUR patients payor mix will be, would suck if they made you see all medicare patients while others got the higher paying private insurance patients. I'd also wonder if they'd include the technical component as part of your collections, for procedures primarily, or only the professional, I'd assume it's the former but it can be a huge difference. But 50% is fine, they're basically saying they'll take half your earnings to pay overhead, which is about industry average.

 

[unlucky87]

Yeah, sounds like collections based which isn't uncommon, but has its faults as well. Definitely check if the volume is there and what YOUR patients payor mix will be, would suck if they made you see all medicare patients while others got the higher paying private insurance patients. I'd also wonder if they'd include the technical component as part of your collections, for procedures primarily, or only the professional, I'd assume it's the former but it can be a huge difference. But 50% is fine, they're basically saying they'll take half your earnings to pay overhead, which is about industry average.

I’m not familiar with the concept of technical fees. Can you elaborate on that? Technical fees are not included, it just professional fees. What difference does it make and is it something of a red flag?

 

[bronx43]

I’m not familiar with the concept of technical fees. Can you elaborate on that? Technical fees are not included, it just professional fees. What difference does it make and is it something of a red flag?

Technical fees are paid out for the ownership and maintenance of the equipment. When you get a MRI, you pay a huge technical fee which is meant for the investment on the machine, and a much smaller professional fee for the radiologist's impression.

The only types of employment where you are also given the technical fee are physician owned groups. There's essentially no chance that a hospital employed position would let you have a taste of the technical fee.

 

[cardsguy2017]

I’m not familiar with the concept of technical fees. Can you elaborate on that? Technical fees are not included, it just professional fees. What difference does it make and is it something of a red flag?

For something like an echo, the technical fee could be something like $150, and is supposed to cover the equipment, overhead, etc. The professional/doctor component might be $75. A physician owned practice collects both fees. Not that you asked, but this technical component for hospital owned groups is huge which leads to all sorts of consequences. What's your job duties? You mentioned outpatient, but are you talking about mostly clinic? What about echo, nuc, etc. 50% of clinic visits isn't terrible and of course will depend on payor mix and patient volume, but if you're reading a lot of studies, 50% of professional fees is weak.