Let's talk RVUs

[LKPAC]

Oh, let's say that a handsome, young PA with around 30 years experience was going to be paid per RVU in family practice.  How much, per RVU, should this well-groomed, medical stud expect to be paid?

[Reality Check 2]

Above what expected basic level and on what basis? - quarterly? yearly?

 

Are you gunning for handsome points as well?..... :)

[Reality Check 2]

http://www.oregonpa.org/resources/2014CME/Speaker%20Presentations/Proving%20Your%20Worth%20-%20Powe%20-%20Smallest.pdf

 

This might be super basic for some but I found it helpful because I hate finance and all things related to accounting.

 

I would like to see who else responds and how RVUs are calculated.

 

My corporate medicine experience is that whomever designs the REV/RVU system makes it entirely impossible to interpret in English and one is expected to just take the check or funds without questions because it is too difficult to explain or understand unless you have a separate degree in Finance/Economics/VooDoo or MoneyGeekTalk.

[mmiller3]

We have a system that gives you tiered RVUs. If you are under the 50th percentile (around 3400 RVUs per year) you make roughly $30 per RVU; 51-75th percentile is I think 32.50 per RVU, and above 75th percentile is $35 per RVU.

 

The kicker is we have so many providers in our office, only 2 providers make the 50th percentile or higher, and they are both physicians. We have a base salary to ensure we don't fall below a certain level, but it still isn't that great. Thankfully I only have a 32-hour work week.

[treejay]

We have a system that gives you tiered RVUs. If you are under the 50th percentile (around 3400 RVUs per year) you make roughly $30 per RVU; 51-75th percentile is I think 32.50 per RVU, and above 75th percentile is $35 per RVU.

 

The kicker is we have so many providers in our office, only 2 providers make the 50th percentile or higher, and they are both physicians. We have a base salary to ensure we don't fall below a certain level, but it still isn't that great. Thankfully I only have a 32-hour work week.

By definition, don't half of all providers make the 50th percentile ?

[LKPAC]

Are you gunning for handsome points as well?..... :)

 

I better not. :-(

[mgriffiths]

I didn't end up taking the job, but a family practice offer I received had a tiered RVU system as well that was paid monthly.  You can look in the "Contracts, Negotiations, & Malpractice forum" for my "Family Medicine Offer - almost a new grad" thread.  Basically anything over 349 RVUs per month got you a bonus, and the amount paid per RVU increased as you met steps.  In talking with many of the other providers in the clinic they average bonus per month was $300-$400, but this was also for 36 hours of patient care per week.

 

This RVU system did not change whether you had 1 day or 50 years of experience, with the assumption that someone with more experience would potentially be more efficient at seeing patients and charting. 

[ventana]

All bonus's should be paid out monthly

Should only be based on your productivity, not the clinic or some other formula

Overhead can not be figured directly into the Calc as that is a manipulation point

You MUST have full access to all billing data, and do checks to make sure they are not submitting under the doc and not giving you the credit

 

 

http://www.aasmnet.org/resources/articledocs/eandmpaymentrvucomparison.pdf

 

99213 is about 2 RVU. $73

99214 is about 3 RVU. $107 (both for Doc rate but if Doc in office likely getting billed under them)

 

These should be the bulk of your codes, so figure on 2.5 for RVU per patient

 

If you are seeing 20 patients a day for 4 days - reasonable schedule

 

That is 80 patients, 200 RVU's per week

 

4.3 weeks per month is 860 RVU per month (with out vacation or holidays or days off)

 

 

$90 per patient = $35/RVU

 

Base Salary of $120,000 for experienced PA with 6 weeks Time off

To cover this you need 240,000k of rev for practice

So 240,000k is $20,000 per month or about 570 RVU's

 

So you should get 50% of anything over 570 RVU's in a month - or 50% of anything over $20,000 collections per month

 

 

 

When you do this math you realize that PCP out patient practices are making a a huge amount of PA and NPs. Then they treat us like terd, give us a few hundred bucks for holiday bonus, ask us to be on call for free, and in general abuse us......

 

Doing the math is very liberating, and something that EVERY PA in outpatient medicine should do. It is amazing to see how much that one or two extra patients a day helps, and it shows we understand the behind the scenes business side....

 

 

 

I read a summary article a year or so ago - PCP doc's take home about 50-55% of their revenue. PA and NP take home about 30-35% - highway robbery in my mind. Just about the same job, pay should be be just about the same.......

[camoman1234]

I have been in practice (FM) for a few years. I take home 20% of collections minus my pay. So what this equals out to be ~ $410,000 I have to collect per year before I start to collect the 20%. Base salary $82,000 (this is great compared to my other job of $66,000/yr) and my first job offer of $55,000 (for cardiology). The average pay around here (midwest) is $70,000 - $75,000, so I am doing well for my base salary. I get 1 week CME, $1,000; 2 weeks vacation with 1 week of sick time, paid malpractice and paid health insurance (for myself, which is NOT normal around here, so this is great as well). I work 8:00 am to 3:30 pm (Mon-Thurs) and 8:00 am to 11:00 am (Friday). Very minimal call (3 calls per month that take me about 3 mins of time on my phone). I just don't know how to approach the boss and tell him I want a higher base salary or better bonus. This is a private rural health clinic, and the boss is easy to talk to, he just likes his money....Thank you! 

[Reality Check 2]

For the hours you list - you are making good money.

Unless you work 8-5 and increase patient volume - I see you as being well paid for what you do.

 

Sorry if not helpful. Your job description looks pretty cushy.

[mgriffiths]

If it were me, I would be much more focused on getting better PTO and CME.  As Reality Check 2 stated, your salary seems pretty decent, but I would agree that the $410k threshold seems pretty high.

 

Either way, you have to show your boss the amount of profit you bring in and that you are not dispensable.  As a result, you would like a bigger chunk of that profit.  (Note: I am still in PA school, but have negotiated jobs in the past)

[Reality Check 2]

Working FULL TIME - Five days a week in a corporate family practice factory - I billed out $750K in a year - BILLED, not collected.

 

My bonus was on what was collected - which is about 63% in some cases.

 

I gladly now work 4 days a week - 10 hour days at a slightly lower pay rate and still make good money 25 yrs out.

 

My sanity and liking who I work with and what I do are so much more important at this point in my life. 

 

Consider all factors.

[shani26]

Thank you everyone for posting on this subject- I am 3 years out working in FM outpatient and pretty much got hosed for NOT knowing this infomation.

Does anyone have any additional resources that would be helpful here?

 

I wish all PA schools at least touched on this before graduation.

[KMD16]

I think as PAs we shouldn't accept position that you'll compensated base on RVU. Too many headache. Too confusing. You'll be cheated! In the end, you won't have any upper hand. RVUs compensation structure applies to MD/DO. My 2 cents

[Febrifuge]

I personally have a pretty heavy bias against RVUs myself, but I'm curious why you say it's a system for MD/DOs and not for us. What's the crucial difference?

[KMD16]

No way to check for it accuracy.

 

As PAs working for a group, 99% you will be screw. You have no say on how the numbers are derived/manipulated.

 

RVU is a total Bull! Even with a honest democratic group.

[fishbum]

You have no say on how the numbers are derived/manipulated.

 

Sure you do....when you negotiate the terms of your employment and choose to accept (or not accept) a position. 

 

Using Ventana's explanation from above, a PA seeing 20 patients/day x 4 days/week x 44 weeks/year (6 weeks vacation/CME, 2 weeks holiday) generates $308,000 in revenue. If that PA is making $100,000/year salary (not bad for primary care) with no RVU bonus, he/she is getting screwed thoroughly by earning only 1/3 of collections while the physicians are making half or more. 

 

You can get screwed by any payment scheme....RVU bonus, salary, hourly, stock options, or whatever else if you don't understand how it works. Or you can understand it and make the absolute most of it. 

[Febrifuge]

Your math assumes collecting 100% of that $308k that gets billed, though. If we use a more typical 65% collection rate, then the PA is earning $100k on a hair over $200k in revenue. That's pretty decent, according to everything I've heard.

[coloradopa]

Sure you do....when you negotiate the terms of your employment and choose to accept (or not accept) a position. 

 

Using Ventana's explanation from above, a PA seeing 20 patients/day x 4 days/week x 44 weeks/year (6 weeks vacation/CME, 2 weeks holiday) generates $308,000 in revenue. If that PA is making $100,000/year salary (not bad for primary care) with no RVU bonus, he/she is getting screwed thoroughly by earning only 1/3 of collections while the physicians are making half or more. 

 

You can get screwed by any payment scheme....RVU bonus, salary, hourly, stock options, or whatever else if you don't understand how it works. Or you can understand it and make the absolute most of it. 

you also assume that the PA has no cost to the practice. benefits 25-40% of Salary. MA - costs. Building - costs. Tongue depressors - cost. I have seen estimates between 1.5-2.5x salary is cost to practice. If you figure benefits at 40% then 2x $140k is $280k not much profit. Bigger organizations can spread benefits across more people. At our large organization with halfway decent benefits we figure costs of benefits are 25% of salary. We bring in 125% of salary. However, the clinic takes out 18% for HR, Malpractice etc. That means starting subsidy is 18%. Add in administration (Manager, data analyst two administrative assistants) and its probably closer to 22-24%. Thats for APPs. Physicians are much higher.  

[fishbum]

Your math assumes collecting 100% of that $308k that gets billed, though. If we use a more typical 65% collection rate, then the PA is earning $100k on a hair over $200k in revenue. That's pretty decent, according to everything I've heard.

 

My example also assumes a PA making 100k for a 4-day work week primary care position with six weeks of vacation and two weeks worth of holidays. I'd bet that that's on the (way) high end of compensation in many parts of the country.

 

you also assume that the PA has no cost to the practice. benefits 25-40% of Salary. MA - costs. Building - costs. Tongue depressors - cost. I have seen estimates between 1.5-2.5x salary is cost to practice. If you figure benefits at 40% then 2x $140k is $280k not much profit. Bigger organizations can spread benefits across more people. At our large organization with halfway decent benefits we figure costs of benefits are 25% of salary. We bring in 125% of salary. However, the clinic takes out 18% for HR, Malpractice etc. That means starting subsidy is 18%. Add in administration (Manager, data analyst two administrative assistants) and its probably closer to 22-24%. Thats for APPs. Physicians are much higher.  

 

I'm aware of what costs a business incurs. I also expect that a revenue-producing agent will earn far more money on his work than will the company who employs him. Years ago, I worked as a commissioned salesman. My take was 20%. The company was very happy to make 3% net. I realize that these numbers might not translate perfectly from one industry to another, but there's no reason that the guy who does the work shouldn't expect to make the bulk of the money that the work brings in. 

 

The numbers weren't the point of my post in the first place. The point was that you can be screwed just as thoroughly whether you're being paid salary, hourly, or production.  

[ventana]

Your math assumes collecting 100% of that $308k that gets billed, though. If we use a more typical 65% collection rate, then the PA is earning $100k on a hair over $200k in revenue. That's pretty decent, according to everything I've heard.

My numbers were based off the approved RVU rate for Medicare, NOT billed. This is as close as anyone with out full access to their billing numbers can get. Most private insurances will pay HIGHER then Medicare. Medicaid used to pay less, but if your state adopted ACA it now pays the same as Medicare. The BILLED amount per RVU is typically about 200% of the RVU pay rate - ie if RVU pay $30/RVU then billed rate is about $60/RVU.

 

You MUST use collections, and then look at 2 things

1) are they billing EVERYTHING the PA does under the PA - they love to slide things under the doc

2) the collections % - in my single payer practice, I knew because I set the fe schedule, that billed was 200% of collected. But many practice can't collect for crap, and write off a lot. This really should never occur - do you get to write off a few car payments, or write off a few mortgage payments? Nope.... A lazy doc will let the practice write off to much (deals with why we all got into medicine - to help people, not to hold their feet to the fire for $)

 

 

 

NEVER look at billed and try to negotiate off that number - it just makes you look silly

 

 

 

As a note - a few years back I read a nice article that stated in the PCP fields - PAs took home about 38% of their collections, while doc's took home about 52% (or so)

THIS is the single biggest thing that we need to change in our payments in PCP - we should both be taking home about the same percentage, not having the doc's magically taking home more - they already get paid more based on 85% for PA, they certainly don't need a higher percentage of collections on top of that

[Febrifuge]

NEVER look at billed and try to negotiate off that number - it just makes you look silly

 

As a note - a few years back I read a nice article that stated in the PCP fields - PAs took home about 38% of their collections, while doc's took home about 52% (or so)

 

THIS is the single biggest thing that we need to change in our payments in PCP - we should both be taking home about the same percentage, not having the doc's magically taking home more - they already get paid more based on 85% for PA, they certainly don't need a higher percentage of collections on top of that

 

I agree with all the above. I still feel better being in a salary and not RVU situation, but that's my own quirks and preferences and not anything I would evangelize for.