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Mitigating Stacking Risks
- 2. Disclaimer • MD Ranger doesn’t give legal advice. • All matters regarding potential Stark or AKS violations (or questions) should go to your counsel or compliance officer under privilege. • Your organization’s physician compensation policy should be approved by either the compensation committee, the Board of Trustees, or both • Fear overpayments based on being above FMV? Talk to your attorney or valuation consultant to consider your options.
- 3. Lauren Dominik-Slaven • Lauren Dominik-Slaven • Experienced healthcare technology executive with 9+ years in industry • Specializes in developing and refining physician contracting processes, policies and procedures
- 4. Today’s agenda • What is stacking? • Why is it risky? • Best practices to prevent stacking • Case studies • MD Ranger: how we can help
- 5. STACKING: IDENTIFYING THE PROBLEM
- 6. What is stacking? When a physician or medical group has two or more agreements with a hospital that, when considered together, are potentially non- compliant (e.g. greater than your organization’s compliance guidelines for compensation or the time commitment may require more hours per year than realistic for the individual when their full scope of work is considered)
- 7. Potential stacking scenarios Stacking can happen when: • A limited number of physicians of a given specialty are available in the market, so the organization must contract with a few physicians to provide an array of services • A healthcare organization contracts with a physician or group on separate agreements • Healthcare organizations don’t have functioning physician contracting policies • Physician contracts aren’t being audited in aggregate (or at all!) • One or more of the physician compensation rates are not commercially reasonable, regardless of whether they fall within FMV
- 8. Another stacking scenario An emergency department call payment rate is based on “opportunity cost” of lost private practice income However, the physician or medical group does not actually end up suffering any losses
- 9. WHY STACKING AGREEMENTS CAN CREATE RISK
- 10. Stacking could lead to overpayments, which could lead to…. ….Stark violations. • Stark seeks to disconnect payments and physician referrals • A physician (or a physician’s immediate family member) who has a direct or indirect financial relationship with an entity that provides “Designated Health Services” (DHS), cannot refer patients (Medicare/Medicaid) to that entity for DHS, and the entity cannot submit a claim for services unless the financial relationship is within a Stark exception.
- 11. Keep in mind • Strict liability statute • An intent to violate the law doesn’t have to be proven • The Yates Memo (2015) enforces individual culpability
- 12. From OIG advisory opinion no. 07-10 • “Depending on the circumstances, problematic compensation structures that might disguise kickback payments could include, by way of example: • (i) “lost opportunity” or similarly designed payments that do not reflect bona fide lost income; • (ii) payment structures that compensate physicians when no identifiable services are provided; • (iii) aggregate on-call payments that are disproportionately high compared to the physician’s regular medical practice income; • or (iv) payment structures that compensate the on-call physician for professional services for which he or she receives separate reimbursement from insurers or patients, resulting in the physician essentially being paid twice for the same service.”
- 13. Overpayments not always obvious Overpayments in physician agreements can be easy to spot, such as paying higher than FMV or paying for too many hours in administrative agreements. Sometimes, reasonable-looking payments that are spread out across agreements or within one agreement are not reasonable when looked at in aggregate.
- 14. COVID-related situations are not exempt • While the CARES act provides some leeway in payment terms and contracts put in place to address COVID-related services, this leeway is time-limited to the declared state of emergency and it does not shelter an organization from all liability • It is important to review and reconcile ongoing physician contracts with short-term COVID-related contracts to ensure there is no inappropriate stacking or overpayment during and after the crisis
- 15. BEST PRACTICES TO AVOID STACKING
- 16. Goals for a physician contracting program ✓ Policies and procedures in place to streamline physician contracting and mitigate risk ✓ Awareness of what the organization spends on physician contracts, and if that amount is appropriate given its profile ✓ Consistent, objective benchmarks or valuations to document FMV and commercial reasonableness of physician arrangements ✓ Identification and monitoring of high-risk arrangements ✓ Strategic thinking, especially regarding: • Evolving physician compensation structures • Potential regulation changes • Changing reimbursement • Profile of physician community • Competitive environment • Unpredictable, dynamic industry
- 17. A contracting policy template ✓ Clear process for contract negotiation and approval that involves board and senior management ✓ Standardized, objective benchmarks across the organization ✓ Policies and procedures for dealing with outliers, based on both dollar threshold and comparison to benchmarks ✓ Process and organization for documentation ✓ Routine schedule for reviewing and benchmarking all contracts
- 18. Policies specifically targeting stacking In order to audit your physician contracting program for stacking risks, your policy should be targeted towards physicians who hold more than one position or who perform more than one service If your organization employs physicians, the review should include clinical and other income for administrative services.
- 19. Establish rules about ED call payments If physicians are holding two call positions at the same time, set guidelines around how much they can be paid. If they are effectively an employed physician, set an aggregate payment cap from all sources.
- 20. Beware of multiple ED call payments • Don’t pay a physician to take call for two services at the same time • Common service combinations where stacking most frequently occurs: • Orthopedic surgery and hand surgery • Plastic surgery and hand surgery • Non-invasive and invasive cardiology • Stroke and non-stroke neurology • Trauma and general surgery
- 21. What to DO when MDs cover two services simultaneously Generally, the ‘burden of call’ consists of the need to carry a beeper and be available, the number of times a physician is called or required to come in, and the frequency of call on the hospital’s schedule. Here are strategies for paying a physician for call coverage panels for two specialties concurrently: Consider per episode or per activation payments as an addition to the base call rate for one of the services Pay for the service with the higher rate Benchmark the per diem payments to a lower percentile (e.g. use the 25th percentile for each service even if your organizational standard is 50th or 75th for standard arrangements) Set an aggregate payment cap if the rate includes a variable component like per episode or activation
- 22. Review and monitor restricted call payments If you are paying more for call because you require a physician to restrict his practice while on call, it is important to validate compliance Ask physicians to certify that their private practice cannot be rearranged to avoid lost income Consider monitoring physicians’ operating room utilization to compare elective volume with and without on-call coverage
- 23. Track administrative time carefully • Time tracking should be standard for ALL physician administrative positions • Compare time records for the same physician if they hold multiple contracts that they report separately, or require them to fill out a single time record for all positions • Leverage technology • As much as you can, automate time tracking and coordinate effectively between all parties: Physicians Finance Administration Pro tip: follow the money
- 24. Additional best practices for administrative time tracking • It should be standard practice to keep time logs even for employed physicians who serve as medical directors. • Hours and payment for administrative services should be defined within a PSA (Professional Services Agreement). • Different specialties and services are sometimes worth different rates even when the same physician is involved (e.g. a surgeon can be paid one rate for clinical care and another for serving as the chief of staff or a committee chair for peer review).
- 25. CASE STUDIES: (MIS)ADVENTURES IN STACKING
- 26. Example 1: cardiologist, administrator, consultant • Dr. Sally Smith is a cardiologist at a 250-bed community hospital, with a busy clinical practice who also serves as medical director of the interventional cardiology service • Serves as the Vice Chief of Staff • Has consulting arrangement with the hospital to assist with EHR transition • Rate for each position falls within the fair market value for that position • Combined payments from clinical compensation and all other positions place her total compensation over the 90th percentile
- 27. Example 1: cardiologist, administrator, consultant • Dr. Smith is being paid more than the 90th percentile of the annual income for a full- time cardiologist • So, if a hospital pays a physician to be a full-time cardiologist, and, also pays the individual for three additional jobs, can the physician be effective in all the roles or should her clinical FTE be adjusted to account for her administrative duties? • Time records for all positions, including scheduled clinic time, should be compared to determine if time commitments are reasonable and in-line with contractual commitments
- 28. Example 1: cardiologist, administrator, consultant Key Takeaway: Dr. Smith’s total compensation must fall within FMV for the positions she fulfills, and justification for excess payment must be documented to demonstrate non- duplicative/non-excessive payments and duties.
- 29. Example 2: ED call payments • Dr. Lara Perez is one of the few ENT physicians on the medical staff who is trained and willing to handle major facial injuries • She staffs two separate panels: ENT and facial injuries • Both panels are paid at the 75th percentile of respective fair market value ranges; she takes simultaneous call for both panels • These arrangements contradict the principles in the OIG advisory opinions and OIG guidelines
- 30. Example 2: ED call payments • Some organizations pay physicians in a similar situation at the high end of the market range for the best paid position • Other organizations will select a rate that blends across the services, or pays a per episode or activation supplement to a base rate, with a cap on total daily payment • Be aware of paying for two jobs at the same time; carefully justify and document whatever payment is made
- 31. Example 3: restricted coverage and opportunity cost risks • Dr. James Kim is a neurosurgeon taking restricted call coverage • Neurosurgery is particularly vulnerable to hidden compliance risks • Frequently restricted coverage; private practice revenue comes from a relatively small number of surgical cases
- 32. Example 3: restricted coverage and opportunity cost risks • The accreditation standard for Levels I and II trauma centers is that neurosurgeons must be immediately available and they cannot conduct private practice while on call(“restricted call”) • Compensation benchmarks for trauma center neurosurgery assume physicians suffer lost private practice income
- 33. Example 3: restricted coverage and opportunity cost risks • However, the physician may not suffer any opportunity cost • Aggregate compensation could be significantly beyond the 90th percentile of benchmark annual neurosurgery compensation
- 34. Example 4: COVID-related hourly compensation • Hospital engages affiliated medical group to staff a COVID clinic and add intensivist shifts in anticipation of surge at a premium to standard rates • Hospital also pays for additional administrative time for staff training and COVID-related strategy • Group has PSA to pay physicians a base compensation plus wRVU incentive; wRVUs decline at practice site
- 35. Example 4: COVID-related compensation • If physician staffs COVID services during times office-based physicians would normally be seeing patients, base compensation should be reduced commensurate with COVID services. • If administrative services are related to COVID, they should be time-limited to the state of emergency, and any excess compensation should not be carried forward beyond the crisis; furthermore, the excess compensation rate should not be paid for the pre-COVID services • Although ‘hazard pay’ may be warranted for the crisis, organizations should be careful to
- 36. ABOUT MD RANGER
- 37. Standardize processes and rates Document market rates and FMV Access 1,500+ compensation benchmarks including salary, productivity and non-salary positions Review and monitor arrangements Have data-driven physician negotiations Mitigate compliance risks The Comprehensive Physician Compensation Solution
- 38. 1,500+ Physician Benchmarks • Total cash compensation • Base/productivity compensation wRVUs • Professional collections • Total cash compensation per wRVU • Base/productivity compensation per wRVU • Total cash compensation to professional collections • Base/productivity compensation to professional collections Used by: • Health systems and hospitals • Single and multi-specialty medical groups • Academic medical centers • FMV and business consultants Hundreds of specialties • 140+ salary/production specialties • 50+ call coverage positions • 90+ administrative services benchmarks • Telemedicine rate • Clinical hourly rates • Medical staff positions • Diagnostic tests and other hard-to-find benchmarks Meet the New MD Ranger • ED call coverage • Medical direction (rates plus annual hours) • Administrative and leadership • Hospital-based service stipends • Diagnostic testing, etc. • Clinic & hourly rates • Telemedicine rates A Comprehensive Source of Physician Payment Benchmarks
- 39. Surveys and databases • 135+ subscribing facilities • More than 38,000 physician contracts across 350+ facilities • 32 states • 25% of reported data are from trauma centers (Level I and II) • Includes large systems, independent, rural, and urban hospitals Salary/Production Benchmarks Other Compensation Benchmarks • 56,000+ physicians • 830+ sites of service • 40 states • Participant breakdown: 64% hospitals; 22% medical groups; 15% other • Includes large systems, independent, rural, and urban hospitals
- 40. INSTANT MARKET RATE DOCUMENTATION NO BLACK-BOX ALGORITHMS EXPERT SUPPORT AND ANALYSIS COMPREHENSIVE PRODUCT-BASED SOLUTION AUDITING AND MONITORING TOOLS FACILITY-WIDE BENCHMARKS Why MD Ranger? WE’RE DIFFERENT. HERE’S HOW. MORE BENCHMARKS; LARGER SAMPLE SIZES CONTRACT NEGOTIATION TOOLS
- 41. Using MD Ranger INSTANT BENCHMARKS AND DOCUMENTATION DOCUMENTSEARCH APPROVE Search 1,500+ MD Ranger benchmarks by specialty or service Use filters like size, trauma status, teaching status, payor mix, region, and more Create custom reports for internal use or physician negotiations Evaluate a rate internally with fewer than five clicks Generate FMV documentation instantly Share reports with key stakeholders and file MD Ranger documentation Submit required documentation per your organization’s guidelines for approval
- 42. Drive performance USE MD RANGER FOR STRATEGIC DECISION-MAKING AUDIT/ MONITOR BUDGET & PLAN OVERALL TRENDS Use benchmarks to budget for new positions, recruitment agreements, PSAs, employment arrangements, and compensation planning Understand time commitment ranges for 100+ administrative/director positions for planning and resource allocation For AMCs: make funds-flow decisions and negotiate rates for outreach services and partnerships Use MD Ranger to provide annual physician compensation reviews and analysis Perform quarterly or annual compliance audits Monitor arrangements and identify risky contracts for compliance View spending by facility and service; drill down by type of arrangement, specialty, or program Understand your organization’s overall investment in physician contracts Compare total spending to benchmarks
- 43. Let’s talk ⁃ Do you feel confident in your organization’s physician compensation and FMV documentation process? ⁃ Are you looking to centralize your compensation policy and procedures, and need a simple solution to streamline your process? ⁃ Do you feel like your organization has risky agreements? ⁃ Reach out: email info@mdranger.com or call our office at 650-692-8873
Editor's Notes
- Hello and welcome to our monthly MD Ranger webinar. I want to cover a few things before we begin. First, my colleague Erik is on the line to help with any incoming questions or comments. If you have questions, please feel free to type them into your chat box on go to webinar. If we can’t follow up with you during the webinar, we will return your message by email or phone very soon. If you have feedback or questions to share with me, I will show my contact information at the end of the webinar so we can be in touch. I’d love to hear from you. Lastly, we will send everyone a copy of the presentation by early next week, and we’ll make a video available within a week.
- If you’re new to us, I wanted to let you know that MD Ranger is not a law firm, I’m not an attorney, and we don’t give legal advice—ever, or in this presentation today. What I’m going to share during this webinar today are best practices that MD Ranger has observed our most progressive subscribing organizations doing within their own physician contracting programs. For all matters regarding exceptional contracts or potential overpayments, we highly recommend involving your attorney or a valuation consultant.
- I'll do a brief introduction, my name is Lauren Dominik-Slaven. I'm a senior sales executive at MD Ranger and I have worked with health care organizations for the past nine years primarily I've worked with legal and compliance in relation to contracting processes policies and procedures and also spend management in relation to contracts.
- Our agenda today is very straightforward. First I’ll cover what stacking is and give you some examples for situations that we’d refer to as stacking. Next, I’ll highlight some of the risks that stacking might bring to an organization from a compliance perspective. The tricky and nuanced thing about this is that if you’ve seen one stacking situation, you’ve seen one. I’ll give you some tips and advice for how to identify it in the first place to hopefully prevent it from happening at your organization—or at least catch it as soon as possible. Then we’ll talk through some case studies because frankly, I find it helpful to understand a specific case and then I can go apply that to other potential stacking situations that I see. I’ve picked some fairly common specialties and situations where I’ve seen stacking occur across organizations, so I’m hoping this part of our webinar gives you insights into your own agreements. I also have a case study relating to the recent COVID situation I saw. Lastly, since we do have some new people listening in today, I’m going to share some information about MD Ranger. I’m hoping you can stay on the line with us, and learn about how we can help your organization with physician contracting. I do want to warn you that we may go a few minutes over the 30 minute time cap- I hope you can stay on with me but I understand if you have a conflict.
- So let’s talk about what stacking is, and why it should be one of your physician contracting compliance concerns..
- Stacking represents a type of physician overpayment that is frequently concealed because it’s often, but not always, distributed across several agreements that a hospital (or hospitals) has with a particular physician or group. Here, you can see, I have outlined a very basic definition of stacking, which is that when a physician or group has two or more agreements that, when considered together may be non-compliant. It’s possible that the physician can coordinate his or her time to fulfill both responsibilities within a time frame generally understood as required to fulfill each agreement separately, for sure. And this happens all the time. However, sometimes an eyebrow should be raised if the scope of both agreements WHEN TAKEN IN CONTEXT TOGETHER, is impossible for one person to do –particularly if the physician has a robust clinical practice too. Just keep in mind that while an agreement may be compliant when considered independently, when taken together, payment may be greater than the 90th percentile or the time required by the position, particularly in the context of the physician’s clinical practice, requires more hours per year than full-time.
- So how does stacking commonly happen? Let’s talk about some scenarios that we at MD Ranger see when we talk to hospitals and health systems. Stacking can occur if, few physicians of a given specialty are available in the market, so the organization must contract with a few physicians to provide an array of services. Stacking can also occur when a healthcare organization contracts with a physician or group on separate agreements, which could lead to overpayments. Which I have seen frequently. If your Physician contracts aren’t being audited in aggregate or believe it or not, at all! You could have a stacking situation. Healthcare organizations don’t have functioning physician contracting policies they are at risk of stacking. If one or more of the physician compensation rates are not commercially reasonable, regardless of whether they fall within FMV stacking could occur.
- Another likely scenario is that a call payment rate assumes an opportunity cost that actually doesn’t exist. Now, this type of overpayment can be extremely difficult to spot, and I’m going to walk you through a case study later in our webinar to go over how to best equip your organization to spot scenarios like this one.
- Let’s talk about some of the specific risks that stacking agreements can bring to your organization.
- First and foremost, not considering the sum of total payments to a physician or to a group could create a situation where you pay more than fair market value to the physician, which in turn could lead to violations of Stark. Let’s take a few minutes to review this regulation, though I am confident that everyone on the line is familiar with Stark. Stark prohibits physicians from referring patients for certain designated health services paid for by Medicare to any entity in which they have a “financial relationship.” And The federal government interprets the term “financial relationship” broadly to include any direct or indirect ownership or investment interest by the referring physician, as well as any financial interests held by any of the physician’s immediate family members. So, the ultimate goal here is to decouple payments and referrals unless the arrangement falls under one of the Stark exceptions or safe harbors as referred to under the AntiKickback Statute.
- Now, it’s important to remember that Stark is a strict liability statute. The good news is that it’s a civil penalty, so there’s no jail time. But, significant penalties have been levied against INDIVIDUALS involved in non-compliant transactions – CEOs, individual physicians, board members and even consultants However, the feds do not have to prove that you intended to break the law. Mistakes, like not having a contract in place while paying a physician for services, is still a technical Stark violation. Despite no jail time, the penalties for violating Stark, even if your intentions were not to break the law, are significant. Keep in mind that the majority of organizations settle with the government and pay tens or hundreds of thousands of dollars in fines—if not millions. I could spend the entire webinar talking about Stark…and we haven’t even touched on the Anti Kickback Statute---so, If you need a more thorough Stark refresher, please check out our on-demand webinar available on our website.
- Shifting gears away from regulations, what does the OIG have to say about problematic compensation structures and how does it relate to stacking agreements if at all? This opinion from 2007 talks about areas to pay particularly close attention to that could result in compliance issues, and I want to focus on the bold language here because they directly relate to our topic today.. So…The first hits on this notion of opportunity cost that ends up not being a lost opportunity. The second discusses classic stacking—aggregated payments that are high in the context of practice income. And the last touches on being paid for the same service twice—and these can be quite difficult to ferret out if you aren’t following the money closely. In fact, over the summer we learned about an organization, with a high performing contracting team mind you, overpaying their laborist group given a combination of payments across the system. There was another we find out about regarding a pulmonologist receiving medical directorship payments that, given the context of his clinical practice, were way too high.
- Here’s my point: overpayments aren’t always obvious and it even happens to organizations who have a high degree of spotlight and attention on their physician arrangements. Yes, there are ways to catch many overpayments in physician agreements, particularly if the contracts are straightforward and benchmarking is available. Risks for overpayments are things like paying above FMV, or paying for too many hours per administrative deal. But, there are overpayments that are a lot harder to catch—particularly when reasonable looking payments are spread across multiple agreements and turn out not to be commercially reasonable when considered in aggregate. I’ve seen organizations take YEARS to uncover a stacking overpayment situation, and I can think of several of them that I’d consider to be high performing organizations on the physician contracting side. You need to be extremely careful
- Many organizations have contracted with physicians to provide additional COVID-related services, both clinical and administrative. These contracts may pay more than your typical FMV rates, so monitoring of sunset clauses as well as monitoring of timesheets to ensure that there is not double payment or inappropriate payment for non-COVID-related services is a must. For hospital-employed physicians it is particularly important to ensure that current payment terms are reconciled with any new paid COVID-related responsibilities to prevent overpayment.
- Yes it is very hard to catch these situations and there’s a lot of variation and nuance to stacking. Now I want to discuss some ways to avoid stacking in the first place and some best practices to implement in your physician contracting program.
- Your overall goals for your physician contracting program, when executed properly, should help prevent stacking from occurring in the first place. What should be your organization’s goals? First and foremost you need to have policies and procedures to support your team, leadership, and organization as a whole. You should also have an understanding and awareness of how much your organization invests in these types of arrangements, and it used to shock me how few organizations knew this number but frankly I’m not surprised anymore because it’s just so common. I think one of the key issues is that there are so few products besides MDR that help organizations track this spending on physician contracts. You must also use consistent benchmarking and or valuations to document that each agreement you have is FMV as well as commercially reasonable. You should have a procedure that describes how you will document these agreements and you need to be consistent about it. You will also want to have as a goal, the identification and monitoring of risky arrangements. And lastly, but certainly not least, your goal should be to be proactive, and not reactive with your physician contracting program. Do your best to think strategically.
- What should your policy look like? Here’s a quick template to take back to your organization for further development. Is your program missing something from this list? If yes, consider adding.
- When it comes to stacking specifically, Develop a policy and review process regarding physicians who hold more than one position or perform more than one service with the hospital or affiliated organizations. If physicians are holding two call positions at the same time, set guidelines around how much they can be paid. If they are effectively an employed physician, set an aggregate payment cap from all sources.
- Let’s spend a few moments talking about ED call, where stacking challenges are common. If doctors are holding more than one call position at the same time, you’ll want to carefully set guidelines around payment.
- While it is OK for a physician to take call for two services at the same time, it is not appropriate to pay them the full rate for both services. Common service combinations where stacking most frequently occurs: Orthopedic surgery and hand surgery Plastic surgery and hand surgery Non-invasive and invasive cardiology Stroke and non-stroke neurology Trauma and general surgery
- So what are some strategies for addressing these situations since many physicians expect more pay if they cover multiple services? Here are some suggestions for the way you could handle things—but every organization is different so be thoughtful when putting together your guidelines on this and consider all aspects of the ‘burden of call’. Consider per episode payments or activation payments along with one per diem. MD Ranger produces benchmarks for both. You could also only pay for the service which has a higher rate. You could consider taking the 25th percentile for both services, adding them together—but beware when you do this to ensure you aren’t overpaying. You could also set payment caps if the contract includes a variable component.
- Another situation with ED call coverage that you need to monitor carefully are high payments for restricted call coverage. You must ensure that the physicians are losing bona fide income here. Ask the physician to sign a statement to certify that his or her private practice cannot be rearranged to avoid lost income in order to take call. Another way is to monitor physicians’ OR utilization to compare elective volume with and without on-call coverage. Main message here is: trust, but verify.
- Ask physicians for time documentation that delineates activities for each role. Time tracking should be standard for all physician administrative positions. As much you can, automate time tracking and coordinate effectively between all parties: physicians, finance, and administration. The best piece of advice I can give to you…..Follow the money. Seriously—this is the single-most effective way to prevent stacking. Always do the math and ensure that all payments, when taken into context together, make sense.
- Before we go into case studies, here are just a few best practices for tracking administrative time and avoiding stacking concerns. It should be standard practice to keep time logs even for employed physicians who serve as medical directors. If a physician has a contract for full-time clinical work and a medical direction contract that requires significant hours on a weekly basis, it is particularly important to monitor the combined payments. Hours and payment for administrative services should be defined within a PSA (Professional Services Agreement). Different specialties and services may be worth different rates even when the same physician is involved (e.g. a surgeon may be paid one rate for clinical care and another for serving as chief of staff or committee chair for peer review, ie positions held by many different specialties).
- Now let’s review some case studies which illustrate common scenarios and services where stacking can easily occur.
- Scenario: Dr. Smith is a cardiologist at a 250 bed community hospital, with a busy clinical practice who is also medical director of the IC service. Additionally, Dr. Smith serves as the Vice Chief of Staff and has a consulting arrangement with the hospital to assist with EHR transition. She is a huge asset to the organization and the rate for each position falls with the fair market value for that position. Her payments from each source should be combined and compared to benchmarks for total compensation to ensure it is not excessive.
- Despite Dr. Smiths talents, these responsibilities could exceed a test of reasonableness, no matter how competent the individual. If you take all of Dr. Smiths payments and consider them together, she’s being paid more than the 90th percentile of the annual income for a full-time cardiologist. It also raises the question that if a hospital pays a physician to be a full-time cardiologist, and also pays that individual for three additional jobs, is that commercially reasonable?
- Furthermore, there is the issue of accurate time- tracking and reporting. There is a possibility that Dr. Smith could—in an admirable effort to be efficient and get the heavy workload done— perform additional administrative duties while she is on-duty and paid as a cardiologist. The takeaway here is that Dr. Smith’s total compensation must fall within FMV for the positions she fulfills, and justification for excess payment must be documented to demonstrate non-duplicative payments and duties.
- Dr. Perez is one of the few ENT physicians on the medical staff who is trained and willing to handle major facial injuries. She staffs two separate panels at the same Level II trauma center: ENT and facial injuries. Both panels are paid at the 75th percentile of their respective fair market value ranges, and she is allowed to take simultaneous call for both specialties. So, while this might make sense to Dr. Perez, it contradicts the principals in the OIG advisory opinions and OIG guidelines if she is being paid for taking call twice during the same time. Her ‘burden of call’ should be carefully evaluated and a maximum daily payment rate should be set. Alternatively, a valuation consultant may be needed to evaluate the ‘cost equivalent’ of her services if the setting is a very busy trauma center with poor payer mix.
- How might the hospital compensate Dr. Perez fairly without overpaying? Some organizations pay physicians in a similar situation at the high end of the market range for the best paid position. Other organizations could look at the 25th percentile range for each service and add them together—but with caution. No matter what is chosen, be aware of paying for two jobs at the same time. Carefully justify and document whatever payment is made.
- Neurosurgery is particularly vulnerable to hidden compliance risks, especially in trauma centers Frequently both a requirement for restricted coverage, plus most non- emergency private practice revenue comes from a relatively small number of surgical cases that are scheduled
- The standard for Levels I and II trauma centers is that neurosurgeons must be immediately available and cannot conduct private practice when on-call (“restricted call”). Thus, compensation benchmarks for trauma center neurosurgery assume physicians suffer lost private practice income given the restriction of the physician’s activities while on call. This assumption is based on the understanding that the neurosurgeon’s practice is busy and nearly all the physician’s time could be utilized for the private practice.
- However, if a physician’s practice has slack capacity and the private practice cases can be juggled (or traded with a partner), the physician may not suffer any opportunity cost. Aggregate call and clinical practice compensation could be significantly beyond the 90th percentile of benchmark annual neurosurgery compensation.
- If a hospital is engaging with a medical group to staff a COVID clinic, call center or other COVID-related services this could create contractual risks if payments aren’t considered collectively. The hospital is specifically paying for additional admin time for COIVD activities and that time overlaps with previously defined clinical duties A PSA is in place to define the base pay and payment per wRVU but the wRVU’s at practice site decline due to COIVD activities. An ICU or hospitalist group must add FTEs to address COVID-related capacity and infection control procedures. In each of these situations, total compensation and all sources of income – non-COVID directorships, coverage, and clinical compensation – must be evaluated to ensure appropriate payment and allocation of resources.
- If the COVID clinic is staffed by the physician when they would normally be seeing patients in their practice, their FTE should be adjusted for the base salary portion of their pay. Also, if the physician is working the COIVD clinic, they also have to fulfill the regular hours defined in their PSA or that portion of their compensation should be adjusted. If admin services are being provided in relation to COVID, the time of these activates performed should be limited to the state of emergency. This is especially true if the rates being paid for COVID activities are higher than their typical work hourly pay. Language also needs to be included in the contract that hourly rates will continue at previous rates if not performing COVID activities. Otherwise, they can’t get paid the higher rate. Situations like these heighten the stacking exposure risk because the dollars are higher and additional monitoring is required by the health system.
- Thank you for being so patient with me as I covered a lot of content today. For those of you who are new to MD Ranger and want to learn about how we support health care organizations in their physician contracting programs, I’d love to take the remaining time we have to tell you more about us!
- We aim to be the foundation of your organization’s physician contract compliance programs, in an all integrated, easy to use platform. The comprehensive scope of benchmarks provides facilities with a virtual one stop shop for documenting payment rates. MD Ranger helps subscribers standardize their physician contracting processes in a way that is best for their organization. Our benchmarks and online platforms can be integrated into all types of compliance and legal processes which means we can be a resource to all types of organizations. Our subscribers use the MD Ranger platform to mitigate risk and to monitor risky arrangements as well as create time saving efficiencies ultimately resulting in them being able to be more proactive in physician compensation and contracting..
- Over the past 10 years our company has radically transformed. We were a paper based report product which had benchmarks. We have now evolved into an online SaAS based solution. Most recently we have integrated salary and productivity benchmarks to provide a full spectrum of physician compensation benchmarks at your fingertips. We have over 1500 benchmarks, some of those you can see here. No one else in the industry has the breadth and depth of benchmarks like we do. In addition to the 140 plus salary and productivity benchmarks we also have over 320 call administrative and hospitalist benchmarks.
- So, we began producing benchmarks in 2009 have grown from a database of 4,000 to over 33,000 contracts since. This is a map of our subscribers and contract database. MD Ranger has more than 325 participating healthcare organizations. We work with all types of facilities from large urban trauma centers to small, rural critical access facilities, surgery centers, dialysis centers and everything in between.
- We are the only product based solution for physician compensation. Whenever you are thinking about FMV opinions and documentation you are probably either thinking about market data or using a firm for an FMV opinion. We strike a balance for using technology for FM V market data and utilizing a firm for evaluation opinion. For SMB documentation as an automated feature in our product it is not a black box algorithm. It plots where you are on the market ranges. Which is great for organizations that have a policy in place stating that if an agreement falls under the 75th percentile of the market range, your payment rate is fine. MD Ranger is a simple elegant solution that helps you capture that in a single streamline document.
- Every organization uses empty Ranger in a different way which is why the product is so adaptable to any process and so widely popular. Most organizations start with these areas searching for benchmarks, documenting the rates they are paying and utilizing the documentation for leadership approval in the overall process. Now for my over achievers, MD Ranger also has additional capabilities that allow you to use your tools to take your physician contracting and compensation process to the next level.
- You can use MD ranger to budget and plan, you can also utilize it for your auditing and monitoring projects and you can see overall spend trends across your organization.