Physicians are Paid a Premium at Trauma Centers

If you’re a trauma center executive, plan on paying contracted physicians more than your non-trauma peers.

According to MD Ranger data, physician contracts at trauma centers are on average at a 23% premium for services.

Why is this the case?  Trauma center physician contract values are higher in both coverage and directorship agreements because of both frequency of coverage needed, as well as the severity of cases received.  Oftentimes, trauma centers have poor payer mix, which impacts physician contracting payments.

The top five services that are paid significantly more at trauma centers are as follows, where the differential is in orange:

9 16Blog-Graph

The amount of medical directors is significantly different, too.  On average, there are 65% more medical directorships and administrative positions at Trauma Centers compared to non-Trauma facilities.

allison

Print Email

Considering Opportunity Cost for Physician Compensation

When it comes to paying physicians for non-clinical work, it is (too) easy to make mistakes that could cost your organization and could be in violation of Stark and Anti-Kickback laws.

Should you pay highly-compensated specialty physicians for non-clinical positions more than you pay a PCP or a pediatrician?  While it could be argued that their time is “worth more”, it is also true that the administrative tasks you are paying them to do shouldn’t necessarily take their clinical salaries into account.  How should your organization respond?

Considering opportunity cost is helpful.  Opportunity cost assumes that there are other alternatives to the activity you are asking the physician to perform.  It’s easy to see that a neurosurgeon might not want to be a medical director if she could use her limited time to practice medicine–and get paid more for it!  Furthermore, because medical directorships, chiefs of staff, and other administrative positions often require that a certain specialty of physician be in the role, physicians of higher paying specialties have leverage.

So, what does the government say about this challenge?  Not surprisingly, the Office of the Inspector General (OIG) is vague.  While it doesn’t forbid compensating higher-paid physicians more in non-clinical roles, it does warn that convoluted compensation structures could mask kickback payments (from Advisory Opinion No. 07-10).

Ultimately, even if you do not base payments on opportunity cost you should at least consider the physician’s perspective.  Most always, physicians who have been asked to play an administrative role have considered how else they could be spending their time, not to mention, how much more they could get paid.  Depending on your market, this could be highly significant to establishing a fair rate…or it might not.

Experts at MD Ranger recommend that every organization develop policy from their overall goals and clinical service needs.  Consistency, data, and documentation should be the backbone of your contracting process.  Curious to learn more about medical directorship compensation?  Check out our webinar on September 19th at 10:30 am PDT.

allison

Print Email

Welcome to the MD Ranger blog

Thank you for visiting the MD Ranger blog. This is a forum for tips and tricks on:

  • Supplying and updating data with the MD Ranger Survey tool
  • Learning more about your spending with the Analytics tool
  • Making the most of MD Ranger Benchmark Reports in negotiation and compliance assurance

Our aim is to continually add content to this site to make this a valuable resource for MD Ranger members. Remember: it’s time to update your contract data! Thank you for visiting.

Print Email

  Product
  MD Ranger Subscription    
  Our Benchmarks    
  Online Platform    
  For Physicians    
  For Post Acute Facilities    
  For Trauma Centers    
  
For Consulting Firms    
      
Company
Team    
Database and Security    
In the News    
Contact Us    
      
      
      
Insights
Contracting    
Compliance    
Webinars    
Briefings and White Papers    
Physician Resources    
The MD Ranger Difference    
Blog    
      
© 2017 MD Ranger, Inc.
1601 Old Bayshore Hwy, Suite 107
Burlingame, CA 94010
650-692-8873
info@mdranger.com
Privacy Policy