Compensation Versus Practice Orientation

Elements of Compensation for Potential Negotiation

E. COMPENSATION VERSUS PRACTICE ORIENTATION Very few physicians, regardless of specialty, practice clinically in a single setting or format. Therefore, even within clinical compensation, it is often appropriate to consider different methodologies of compensation for different types of clinical effort.

Based on CPT-level survey data, we know ID physicians, on average, record approximately 75% of patient encounters in an inpatient setting. Therefore, a hybrid compensation formula is appropriate in most cases, recognizing the unique differences between settings through separately derived compensation methodologies.

1. Inpatient-Oriented Clinicians Key Data Point We know from IDSA’s survey data that physicians who have a component of compensation tied to quality or value-based metrics are compensated more than physicians without such a component.

a. Inpatient Settings With Consistent Volume Physicians who spend most of their time in an inpatient setting that has consistent patient volumes can maintain a production model that compensates per wRVU generated. Despite this, it is vital to establish realistic wRVU thresholds or targets based on the patient volume under a production model. In addition to ensuring some stability through a fixed component of compensation, an ID physician on a production model should also consider advocating for a component of compensation that is tied to quality.

b. Inpatient Settings With Inconsistent Volume Physicians who spend most of their time in an inpatient setting that has inconsistent volumes outside the physicians’ control are gravitating toward heavily time- and value-based compensation methodologies. For these physicians, a fixed rate per shift, day or week coupled with an incentive for quality is the ideal compensation model. This model has proven to increase compensation over time in several inpatient-oriented specialties, such as hospital medicine, critical care and emergency medicine. In a setting where volume cannot be controlled by the physician, a shift to value (e.g., payment for time and high-quality work) is appropriate.

c. All Inpatient Settings Aside from securing a value-based component of pay through quality incentives, physicians practicing predominantly in the inpatient setting can benefit from tracking their activities in detail. In establishing an hourly rate as the basis of a shift, daily or weekly rate, it is necessary to understand how busy a physician is when providing inpatient services and when services have become materially busier. Data elements to track include: • Hours of restricted (on-site) versus unrestricted (off-site) coverage; • Calls per shift; • Hours per call; • Number of medical consults per shift; • Hours per medical consult; • Round-trip travel time per activation (if providing off-site coverage); • Total on-site rounding time per shift.

It is also important to understand ID physicians’ value proposition to other specialists working in the hospital. An opportunity exists to partner with non-ID physicians who benefit from ID services in the hospital (i.e., improved outcomes and efficiency) in negotiating the fixed rate and value-based incentives. This strategy has proven most successful in hospital medicine, wherein hospitalists have taken ownership of certain patient populations entering the hospital, allowing proceduralists and some medical specialists to operate more efficiently.

Relatedly, an evolution of best practices requiring ID interventions for certain patient populations (e.g., sepsis) will increase the demand for ID services such that carefully tracked data clearly shows increased activities. This increased level of activity then becomes a component of compensation negotiation.

2. Ambulatory-Oriented Clinicians Physicians who spend most of their time in the outpatient setting, one in which the physicians can more directly influence patient volumes, tend to gravitate toward production-based compensation methodologies (e.g., wRVUs, collections, revenue less expense). For these physicians, a guaranteed salary and a productivity incentive (i.e., compensation per wRVU) methodology is most common.

In this model, base compensation is often determined by multiplying a compensation per wRVU rate by 50% to 90% of projected wRVUs. The remaining 10% to 50% of expected wRVU generation is compensated as an incentive. Importantly, these physicians have a considerable upside to compensation potential because they continue to receive compensation for wRVUs generated beyond expectations. Organizations can establish compensation per wRVU rates based on national benchmarks that are reported annually or an internal process to calculate the rates. See table 9 in section V.A.3 for the 2023 blended national compensation to wRVU rates.

In almost all ambulatory settings except primary care, a production-based model is dominant. Many also include quality-of-care or patient satisfaction incentives, although this is a small portion of the overall incentive structure. Depending on how quality incentives are structured, compensation tied to quality can represent either a carrot or a stick incentive model.

However, in integrated health systems, large medical groups and AMCs, physicians may be asked to engage in low-wRVU-generating ambulatory activities, such as attending multispecialty clinics as the secondary specialty. Participation in multispecialty clinics, such as one in support of a limb salvage program or wound care program, should be recognized through either a stipend per clinic attended or a revised compensation rate per wRVU.

Furthermore, some physicians in ID are specifically deployed in a setting that does not align with traditional ID benchmarks. In some instances, these physicians advocate that a non-ID benchmark compensation rate per wRVU should be adopted to capture the value of the work being performed. As an example, an ID physician may spend 25% of their ambulatory time working in a wound care clinic. This physician should explore the possibility of recalibrating the compensation per wRVU rate to account for this time.

3. Primary Care-Like Clinicians In some cases, usually associated with specific patient populations or DRG groupings such as treatment for patients living with HIV, ID physicians serve as the main provider of care for their patients. Therefore, there are elements of how compensation is structured within primary care and family medicine that are relevant and ideal for ID physicians who have a primary care-like orientation to their practice. In such a setting, the shift from volume to value is pronounced. Across the US, primary care groups are participating in value-based contracts that reward high-quality care. These physicians have seen their compensation increase over time as a result, and this is an approach to compensation that can be borrowed by ID physicians under unique circumstances. IDSA will be releasing a Value-Based Arrangements Guide this spring, which will provide more information and guidance on this topic .

4. Telemedicine Telemedicine volumes have increased nationwide as a direct result of the COVID-19 pandemic, increasing from less than 1% of health insurance claims in 2019 to 5.4% of health insurance claims as of June 2021. ⁴ This “new normal” will have a lasting impact on clinic staffing needs, reimbursement and patient access strategies.

Within ID, many physicians are engaging in telemedicine services to improve efficiency (e.g., provide more consults or clinic visits per hour) compared to in-person patient encounters. Some health systems and AMCs only recently expanded telemedicine services and have not clearly defined or considered how compensation should be recalibrated to consider the new service.

As is the case with the various in-person practice settings discussed above, telemedicine services can be performed under different circumstances that should influence how physicians are compensated.

a. Curbside Consult Telemedicine Services (Physician-to-Physician Phone Consults) For many physicians engaging in telemedicine services as a proxy for in-person consults in the inpatient setting, reimbursement from payers can be nonexistent or minimal depending on the circumstances, yet the services are incredibly valuable for the hospital or health system. Therefore, ID physicians providing telemedicine services in this capacity should negotiate for a compensation methodology that incentivizes availability. Compensation can take the form of an hourly or shift rate or a fixed stipend that is based on the number of expected hours of availability.

b. Scheduled Telemedicine Services For physicians engaging in telemedicine services as an alternative to in-person clinic or outpatient care, reimbursement from health insurance payers tends to be more certain and is often at a reduced rate compared to comparable in-person services but enables physicians to see more patients per hour. Therefore, ID physicians providing telemedicine services in this capacity should negotiate for a compensation methodology that incentivizes production, akin to how ambulatory-oriented physicians tend to be compensated.

c. E-Consults (Direct Patient-to-Physician or Physician-to-Physician Asynchronous Encounters) Many institutions have established e-consult services in the outpatient setting, which are reimbursed from health insurance payers as long as certain requirements for that e-consult are met. For physicians engaging in e-consult services in addition to other clinical duties, the physician should be appropriately compensated for or have dedicated time to perform these e-consults. Compensation can take the form of an hourly or shift rate or fixed stipend per visit.

4. FairHealth, “Monthly Telehealth Regional Tracker,” fairhealth.org/states-by-the-numbers/telehealth.