Compensating for More

John Phillips, president of Brentwood, TN-based PivotHealth LLC, a physician practice management and services company, shares similar ideas about incentivizing physicians. Phillips says one of the medical groups he worked with paid its physicians wRVUs based on national standards. "We used MGMA and AMGA data, and then if they were in a high production tier such as above the 75th percentile we multiplied their wRVUs at that level by 1.10 to provide additional compensation as a reward for the high production. The justification for this was that those last wRVUs produced had very little additional overhead costs associated with them and were, therefore, very valuable to the medical group."

Hospital takeaways
Papoff has established a set of metrics he shares with physicians, something he advises hospitals that employ physicians to consider doing as well. Most hospitals, he observes, share things like gross charges and collections, which is also what MacNeal was doing before Papoff arrived. Physicians need to know, for example, their percentage of new patients to determine if they are keeping a flow of new patients into the practice.

Physicians are also privy to coding information, and Papoff has come up with a formula for computing the average level of code based on Medicare claims data. And he provides physicians a detailed analysis of their denials, which has gone over well. "One physician who has been here for some time said, 'I have been waiting for this report for years.'"

Papoff is gearing up next to roll out the comp plan to the group's orthopedists and eventually all of the physicians.

—Michelle Ponte