What goes into a comparable RVU $value?

[Lashler9054]

My PP tells potential candidates that we earn approximately $35/rvu. This is based on payor mix at all the institutions we service. Doing the math, and assuming generating 10k RVU/year, the salary doesn’t look competitive. we also get a bit more revenue from our hospitals that we use for call stipends and overhead and this drives up our income and makes the salary much more
competitive than what $35/rvu would indicate. so my question is: what goes into your RVU number? is it strictly a blended average of all your payors or is there a component of hospital revenue in there? are there other components of that RVU value that i haven’t mentioned?

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[thinkorswim]

Every group is different.

Some groups use the pooled revenue from cases and pay based on traditional ASA units.

Other groups tweak the way they calculate units for cases and procedures, thereby artificially raising or lowering their unit value.

A group can also roll the stipends they receive into their unit value and raise it that way.

In the end, it shouldn’t matter matter how a group calculates their unit value as long as it’s fairly distributed among the members.

 

[Lashler9054]

so basically the $/RVU is not a meaningful datapoint for compensation because the way practices calculate it is not uniform

 

[UscGhost]

so basically the $/RVU is not a meaningful datapoint for compensation because the way practices calculate it is not uniform

Correct. It's pretty common for physicians to settle for the higher advertised unit rate despite the overall compensation being lower due to poor block reimbursement or lack of call stipends.

-compare base unit rates
-compare compensation for regional. Blocks can contribute 15% of your revenue generated, so a group that pays 2 units per block is substantially less than a group that pays 8 units.
-call stipends? Take your monthly units and factor in the call stipends to determine your true take home unit value. In my group, it adds an additional $6 per unit take home on avg.
-do they pay for the time between anesthesia start and in OR? Easily 1-2 units per case, which is about 5-10%

 

[NICMAN]

Our billing only provides 60-65% of what we actually need to run a private practice. The hospital provides the rest. With diminishing reimbursement from commercial and public payors that percentage will continue to decline. Nobody will earn a competitive salary based on billing alone. Pay-for-performance will suffer unless hospitals tie salaries or subsidies to metrics since payor revenue will become less of a component of any single anesthesiologists paycheck.

The actual question should be “how much do I make per hour worked?” Break that down 7-3, 3-5, 5-7, and then 7 PM to 7 AM. If the hospital or PP group doesn’t make that rate competitive then move on to one that will.

 

[UscGhost]

Our billing only provides 60-65% of what we actually need to run a private practice. The hospital provides the rest. With diminishing reimbursement from commercial and public payors that percentage will continue to decline. Nobody will earn a competitive salary based on billing alone. Pay-for-performance will suffer unless hospitals tie salaries or subsidies to metrics since payor revenue will become less of a component of any single anesthesiologists paycheck.

The actual question should be “how much do I make per hour worked?” Break that down 7-3, 3-5, 5-7, and then 7 PM to 7 AM. If the hospital or PP group doesn’t make that rate competitive then move on to one that will.

All correct.

Pay per hour is difficult to calculate in a productivity model. Most don't track hours unless you clock in and out

 

[AKMD_1984]

Our billing only provides 60-65% of what we actually need to run a private practice. The hospital provides the rest. With diminishing reimbursement from commercial and public payors that percentage will continue to decline. Nobody will earn a competitive salary based on billing alone. Pay-for-performance will suffer unless hospitals tie salaries or subsidies to metrics since payor revenue will become less of a component of any single anesthesiologists paycheck.

The actual question should be “how much do I make per hour worked?” Break that down 7-3, 3-5, 5-7, and then 7 PM to 7 AM. If the hospital or PP group doesn’t make that rate competitive then move on to one that will.

correct. with hospitals having all the power and making a killing out of facility fees, it is only natural that the anesthesia costs are "subsidized".

 

[Lashler9054]

Our billing only provides 60-65% of what we actually need to run a private practice. The hospital provides the rest. With diminishing reimbursement from commercial and public payors that percentage will continue to decline. Nobody will earn a competitive salary based on billing alone. Pay-for-performance will suffer unless hospitals tie salaries or subsidies to metrics since payor revenue will become less of a component of any single anesthesiologists paycheck.

The actual question should be “how much do I make per hour worked?” Break that down 7-3, 3-5, 5-7, and then 7 PM to 7 AM. If the hospital or PP group doesn’t make that rate competitive then move on to one that will.

makes sense but i see folks posting and commenting here on $/RVU, so it appears many folks still think about compensation in this manner

 

[DesiredMemberName?]

makes sense but i see folks posting and commenting here on $/RVU, so it appears many folks still think about compensation in this manner

People often looked at unit value as representative of the payor mix, which was a proxy for assessing the rate of pay for productivity back in the days before groups needed to rely as much on hospitals for subsidies.

As others have stated, a group can change this number by doing things like deducting overhead before or after unit value calculation, paying higher or lower call stipends, paying a daily rate, etc. So, it must be contextualizad to be interpreted properly.

 

[thinkorswim]

Our billing only provides 60-65% of what we actually need to run a private practice. The hospital provides the rest. With diminishing reimbursement from commercial and public payors that percentage will continue to decline. Nobody will earn a competitive salary based on billing alone. Pay-for-performance will suffer unless hospitals tie salaries or subsidies to metrics since payor revenue will become less of a component of any single anesthesiologists paycheck.

There are still groups out there that do just fine without any subsidy. But you’re right, the ceiling is becoming lower every year and it won’t last forever.

makes sense but i see folks posting and commenting here on $/RVU, so it appears many folks still think about compensation in this manner

This is really the only way to present compensation in a traditional productivity model since an hourly rate can fluctuate significantly each day depending on what you’re doing. That’s why it’s important to look past the unit value and really figure out how the units are calculated and the hours required.

 

[GassYous]

The problem is that there is a continuous downward pressure on rvu as medicare constantly cuts rates in their pretend attempt to keep the overall budget neutral. But facility fees are continually increased. So hospitals make more and more as physicians make less and less. Our pay right now is about 10%-20% subsidized by the hospital.