Everybody associated with physician compensation is familiar with RVU’s. Gone are the days of a straight fee for service environment which billed at the prevailing insurance and Medicare rates. RVU’s have been introduced as far back as the 80’s and were widely adopted in 1992. The whole of the medical system has been moving in the direction of a more patient outcome basis. Add in the ACA and the accountable care organization model and it will come full circle. According to a Merritt Hawkins physician employment paper, the RVU system is a bridge from fee for service to the ACO’s in which they realize income through shared savings. With so many physicians employed by large health systems and the death of the private practice, these models become significant in physician compensation.
Value based models allow doctors to treat all patients regardless of insurance status without concern for type of insurance or acuity. Sounds straight forward. Nothing ever is. There are differences between the Medicare RVU and private insurance RVU. The CMS uses a Resource-Based Relative Value Scale method. This is a total RVU system that incorporates Physician Work RVU, the Practice Expense RVU and a Malpractice Expense RVU, the total RVU is adjusted by locality (GPCI), before being multiplied by the conversion factoring calculating the reimbursement for a service. Got that? Most employers compensate physicians by the “Physician Work RVU” that the physician generates. In most cases physicians see patients from payers other than CMS.
So how does this affect the trauma & acute care surgeon? Annals of Surgery reported back in 2005 that trauma and acute care surgeons with no private elective component have significantly lower charges than their counterparts who had an elective surgery component. Since the RVU is based on procedure and then the modifiers are applied, the RVU does not adequately reflect the effort, complications and risk associated with an emergent patient receiving a similar procedure as an elective patient. Complications rates are higher, readmissions, mortality are higher due to the patient economic status, health history and the circumstance of the emergency. Factors such as these increases the chance of negative outcomes lower the relative value instead of increasing it!
Annals of Surgery reports that ratios for complications and readmissions are twice as high as the same elective procedure. There are remedies, but they are hard to implement. Ten years ago at many Level II and Level III trauma centers, a trend emerged that incorporated the acute care surgeon doing both emergency and elective surgeries. The surgeon would have to maintain some type of hospital based office and then make time to balance both type of cases and adequately schedule his life around two specific practice types. Not sure how much this done anymore especially in the Level II centers. Even with this, the emergent RVU’s would be a drag on the elective RVU’s giving the surgeon a lower income. Are higher based salaries and less emphasis on the RVU’s a solution? Yes, but this goes directly against trends, and the 75th % tile income by specialty rulings triggering an audit; and would demand greater subsidies from the health system and state and local governments. The average salary according to salary.com for a trauma surgeon is $358, 000, the 75th % tile is $428,990 and the 90th % tile is $493,216.
Trauma & Acute Care Surgeons provide an incredible service that takes guts, ingenuity and heart to perform under very difficult circumstances. Shouldn’t the RVU factors be in a separate category that take these emergent factors into consideration? The answer is yes.
Carmen A. Renaldy III is the President of Med-Link Staffing and active board member of the National Association of Locum Tenens Organizations(NALTO).