When starting a career in gastroenterology, physicians tend to work in the hospital, where there is usually high demand for services and productivity goals are easy to meet. This is a little different in private GI groups, where it takes some time to build up your patient base. This might be a significant concern for young physicians considering private practice. But understanding the role that productivity plays in compensation packages can help in choosing the right group to join.
Dr. Nadeem Baig
While compensation models may differ from practice to practice, there is usually a base salary provided with a productivity bonus. Some practices may use productivity along with other measures to determine when a physician is eligible to become a partner in the practice. Partnership is often accompanied with the benefits of ancillary services ownership such as ambulatory surgery centers (ASCs) and anesthesia, pathology, and infusion services.
Kevin Harlen
How is productivity measured?
Most practices utilize relative value units (RVUs), a standard used by Medicare to determine the amount to pay physicians according to their productivity. Most public and private payers are utilizing the RVU system first developed for Medicare as a useful, time-saving way to handle physician payments. The RVU defines the volume of work doctors perform for all procedures and services covered under the Medicare Physician Fee Schedule.
The Medicare Physician Payment System has three components:
• The geographic practice cost indices (GPCIs)
• Relative value units (RVUs)
• A conversion factor
It is important to understand the types of RVUs that exist to understand how to calculate them properly – these include the following categories:
• Physician work, which accounts for the time and effort to perform a procedure.
• Practice expense, which is for the costs of nonphysician labor such as rent and supplies.
• Global fees, which includes fees for initial visits, follow-ups, and practice expense, and applies during a predetermined length of time known as the “global periods,” primarily for major surgeries.
• Malpractice expense, such as costs for professional liability insurance.
There is no specific dollar amount attached to an RVU because RVUs are part of a resource-based relative value scale (RBRVS) which uses RVUs to relate medical procedures to each other. Payment for physician work is based on whether the procedure is performed in an ASC or hospital outpatient department or in an office. A separate facility fee payment is made to the ASC or hospital outpatient department for procedures performed there. Other elements include skills and the amount of time needed to perform a procedure. Calculating the reimbursement from an RVU involves several components and a significant amount of complex math.
