With RVU-based compensation and bonus, either the practice or the employee may be shortchanged, as follows:
Practice has many low-reimbursing payors – Practice is short-changed
In practices with many self-pay (often becomes no-pay) or Medicaid patients (with its lower reimbursement), the practice may be shortchanged by tying compensation and bonuses to RVUs. Although the employed physician meets his RVU work requirement, the lower reimbursement will result in lower practice income which may be insufficient to cover the physician’s compensation and bonus.
Practice has many traditional reimbursing payors – Physician-employee is short-changed
In practices with a payor mix of traditional carriers (Medicare, BCBS), the employee may be shortchanged. Presuming the same level of RVUs are achieved (as in the above example), the practice’s higher income may far exceed the physician’s compensation and bonus
I prefer physician-employee compensation and bonuses which are based on income generated by the employee, and not based on RVUs.
- RVUs is a nebulous, difficult to understand term, but dollars and cents is a universally-understood language.
- The more or less income the practice earns based on the employee’s services, the more or less compensation and bonus the employee gets.
Stated plainly: Pay me based on what income I generate, not the number of hours (which will increase RVU’s) I work.
This article Was contributed by Bruno Stillo, Physiatry Billing Specialists. 800-835-4482, [email protected]