New wRVU bonus structure -> acknowledging nurse's work

[klairsee]

I tried to search this topic but didn't find anything. This may be unusual. 

I'm a primary care PA-C. A while back, APPs went from flat salary to salary + wRVU. I work for a big profit-focused system. I initially thought salary + wRVU might be a worse deal for me because they slashed the base salary when they added wRVU.  However, I think, with some tweaks to scheduling and being as diligent as possible with accurate coding, it will be somewhat more profitable over time.

I work 1:1 every day with a wonderful LPN. She is sharp as a tack. She accurately predicts diagnoses before I even go in the room many times, and she is highly valuable to me but under-paid by our system. There are few scenarios in which we have extra help during the day. We sink or swim together. So, increasing my productivity linearly increases her workload. If I ask her to convert a follow up visit to a Medicare AWV on the spot, she does it and does not complain. If I overbook a kid, no complaints.

I feel ethically compelled to acknowledge tangibly that any excess profitability of the wRVU bonus structure for me is tied directly to increased work for her as well. Therefore, I plan to give her a personal cash gift on a quarterly basis to acknowledge her work. I've spoken about this with practice management and ethics/compliance and they did not feel it is a problem. 

Does anyone out there have experience with this? I have heard of physicians doing this in the past but I don't personally know any. What is a proportionate gift vs. the wRVU bonus?

 

Edited November 19, 2022 by klairsee

[rev ronin]

I'd go proportionally perhaps 25% of the bonus, certainly no less than 10%.  That may be generous, but I wouldn't mind doing it to keep an awesome LPN around. The biggest problem in my mind would be taxes: You're going to get taxed on that money at your highest nominal rate... and then what, gift it to the LPN?  Sounds like a problem waiting to happen, and I would recommend a tax accountant get involved in your decision making.

[klairsee]

Ok great, we're thinking in similar terms. I was thinking ~ 20-25% of the excess earnings, meaning the post-tax amount earned over what my prior base salary was. I have a spreadsheet set up to calculate that.

I've thought about the tax aspect also. Consulting a tax accountant is great advice, so that will definitely be the next step.

Thanks for the input! 

[Mayamom]

Are the other providers going to do this also?  Its very generous and thoughtful of you but if there are other LPN or MA not participating it may be an  issue. 

[klairsee]

I don't know what the other providers do. I figure that's between them and their staff so I didn't plan to ask them. 

[ventana]

Oh man. Can o worms. 
if it is not to much (<$1000) it likely will be no big deal. 
more then that and you are going to set off fireworks. 
infighting   Complaints.  Griping 

honestly people are petty. 
hospital admin will use it against you to give you a pay cut 

other nurses will resent her. 
 

Keep it small so the idea counts but I would say like  $500 each time max. 

[Mayamom]

10 hours ago, ventana said:

honestly people are petty. 

That's what I was thinking. If other co workers find out which they will may become an issue. 

[ANESMCR]

On 11/19/2022 at 2:18 PM, klairsee said:

Ok great, we're thinking in similar terms. I was thinking ~ 20-25% of the excess earnings, meaning the post-tax amount earned over what my prior base salary was. I have a spreadsheet set up to calculate that.

I've thought about the tax aspect also. Consulting a tax accountant is great advice, so that will definitely be the next step.

Thanks for the input! 

Be careful. Start small and increase from there. It needs to stay between you and your nurse. Your nurse should know nothing about your salary/bonus structure and keep it that way. If you start at 25%, and your RVU bonus increases with more productivity, that 25% could be enormous and it would be awkward to remove a previously set sum. For example, I personally bonus my MA at 5% (and no more) of whatever quarterly RVU figure I have after taxes. Usually comes out to around $5-600. If it were 25% that’d be almost $3,000 ($12k/yr). No way.

Edited November 21, 2022 by ANESMCR

[rev ronin]

Yeah, the 25% figure is definitely not good for all contexts and structures; I should have tacked a disclaimer on to that.

[klairsee]

Y’all are bringing up great points. I appreciate it. Wanted to make sure I’m looking at it from all angles. You’re all exactly right that it could cause in-fighting, which hopefully she’s smart enough to control by not saying anything but I know how that goes. I think my RVU potential has a low ceiling because I’ll never have more than 1 nurse so that’s less of a concern. But again, you never know.

I consulted a tax man. He said it would not have tax implications other than I’m paying taxes on money that is ultimately not mine. 

[rev ronin]

7 hours ago, klairsee said:

I consulted a tax man. He said it would not have tax implications other than I’m paying taxes on money that is ultimately not mine. 

Make sure she knows this, too, so she doesn't report it as income and pay taxes on it AGAIN!  Give the government their legal share, but I can think of better charities to donate to...

[ventana]

But it is income to her.  
 

I would honestly keep it a token amount. 
 

to many landmines.  You will step on one.  

[rev ronin]

5 hours ago, ventana said:

But it is income to her. 

If she's entitled to it, yes.  If it's entirely at the OP's discretion, it's a gift.

Neither of us are tax accountants, of course, and hence me suggesting the OP get one to double check the Free Internet Advice^tm