Base Salary/-Shift Pay (Hospitalist, ED, Urgent Care)

It is common (and expected) for physicians in ED, Urgent Care, Hospitalist to be paid primarily on a base salary (or by shift). These physicians don’t have a lot of ability to control or increase their volume. But if you are one of these physicians, it is helpful to know and understand your data and how many patients you are seeing and wRVUs you are producing because you could be underpaid for the amount of work you do compared to your peers. It is less common to see primary care physicians or specialists on a straight base salary (with no production incentive component).

Base + Incentive

Base + Incentive is the most common type of physician compensation agreement. Physicians usually have a nominal base salary (which is made up of anywhere between 50-75% of their total salary) and the rest is earned through their production incentive (usually based on wRVUs).

The incentive amount is always where the devil is in the details – what threshold do you need to hit to start earning your incentive? What is the $/wRVU rate of your incentive bonus?  Is it tiered as in the dollar per wRVU increases with your level of production? Incentive payments are often times smaller dollar amounts, so in reality, the health system is receiving a large incremental financial benefit but the physician is only getting a disproportionally small piece of that.

wRVU Production

Straight wRVU production is also a very common compensation plan most health systems use. But as a physician, it is critical to negotiate in order to receive the best $/wRVU rates and understand the nuanced details such as if there are any escalators/bonuses built in and if so, how do you achieve these. Getting the highest possible $/wRVU rate is critical because often times, employers don’t include additional money for paid time off or administrative time by claiming that it is part of the $/wRVU rate. Additionally, DocPay recommends for physicians who are on a straight wRVU production plan to have a 3^rd party independent coding audit every so often (at least twice a year) to ensure that all of the work you are performing is coded and billed properly and the wRVUs are being appropriately attributed to you.

Revenue minus Expense (usually seen when a medical group acquires a whole practice/division/or entity)

This is the most “risk” the physician will take with their compensation as the physician is not only responsible for the revenue (or production) component (similar to a wRVU model contract) but the physician(s) also responsible for the expenses associated with his or her practice. Typically, the health system provides IT support, the EMR platform, and usually some overhead (such as administration and medical malpractice), but the newly employed physicians have decision making authority and financial responsibility for their staff costs, office rent, marketing, supply costs, physician benefits etc. The Revenue – Expense model is very similar to being in private practice. Even though this sounds attractive to have a “private practice” compensation model, it is not very common and you are still employed by the health system and will have to abide by their policies. So you basically get all the headaches of both being an employed physician and in private practice, without the complete financial upside.

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