1. Title: Multi-Factor Incentive Pay System in an Emergency Medicine Department
Study Objectives: Salary plays an integral role in the ability to recruit and retain skilled
Emergency Medicine Providers. According to Daniel Sterns & Associates (2009) a near
majority (46%) of EDs have implemented Relative Value Unit (RVU) based pay models as a
retention and recruitment tool. A review of existing Fee for Service Incentive Pay systems in
EDs found that most salary models compensate providers for patient disposition only, leading to
undesired adaptive behavior such as inappropriate chart selection or disproportionate sign out.
To overcome this perceived inadequacy, a system was created that credits providers for multiple
aspects of patient care; specifically: screening evaluation, initiation of care, completion of care
and disposition, oversight of midlevel provider care, and performance of procedures.
Methods: Over a one year period, various incentive pay systems already being utilized in other
EDs were examined to identify opportunities for improvement. An improved incentive pay
model was developed, requiring the resolution of a number of systematic barriers including
billing and payroll modifications, and various accounting methodologies for payouts.
Additionally, a legal review of the model was conducted. The resulting fee for service incentive
pay system utilizes an approach that multiplies the RVUs associated with the various
components in the model by a weighted factor. This total is then used to distribute the pool of
income that is incentive-based. The split of base income to at-risk income is 65%-35%. In
conjunction with this model, there was focus placed on improving provider documentation.
Results: The fee for service model was implemented on July 1, 2010. In comparing second
quarter post-implementation data to the second quarter of the previous year, the ED realized a
5.6% decrease in length of stay (LOS) and a 15.7% increase in patients per hour per provider.
Additionally, the average charge per visit has increased by 8.71% with an increase in critical care
billing from 0.5% to 2.9%. The authors found that implementing this fee for service model,
along with a program to improve documentation has allowed legitimate billing for higher levels
of service, while minimizing financial loss due to poor documentation and subsequent down-
coding.
Conclusion: This comprehensive fee for service model has yielded some impressive results.
The incentive pay system encourages providers to be involved with all aspects of patient care,
from the time of arrival to disposition. This program has had dramatic impact on billing levels,
reduction in throughput time and increased gross collections, along with minimizing financial
losses due to poor documentation and subsequent downcoding. Next steps include program
expansion to include quality and service measures including service excellence and citizenship.