Hospitals, Physicians Negotiate Call Pay

Physician Compensation and Recruitment, July 9, 2009

As healthcare organizations continue to struggle with on-call compensation issues, hospitals, like physicians, are starting to push back.

Sixty-two percent of healthcare providers receive some form of additional compensation for on-call coverage—most as per diem or at an hourly rate—according to MGMA’s inaugural Medical Directorship/On-Call Compensation Survey Report.

But on-call compensation remains an area of contention.

Some hospitals are initiating new call programs with limited or capped budgets to manage call compensation, says Debbie Huber, MBA, vice president of sales and client services at EA Health Corp. in Solana Beach, CA.

In response, practices are demanding that hospitals demonstrate that limits are necessary, Huber says.

To successfully negotiate caps or reductions, hospitals may need to quantify call burden, Huber says. Factors may include:

  • Manpower available to take call
  • On-call frequency
  • Call-in frequency
  • Intensity and acuity of patients seen
  • Duration of services provided
  • Physicians’ liability exposure for the provision of on-call services

Since the call burden may differ across specialties, hospitals may need a mechanism to fairly align compensation based on the true burden of on-call services, Huber says.

Peg. L. Stone, a compensation consultant at Atlanta-based PLS Professional Associates, LLC, sees a growing need to defend on-call payments. "Hospitals and physicians need to document the reasonableness of any on-call payments and make sure they hold the test of being within a fair market value for the services," says Stone.

Questions to explore when considering such payments include:

  • Does the hospital have problems covering the on-call periods for the specialty?
  • Could the compensation be considered a double payment for physician services?
  • Is the compensation an incentive for the physician to refer patients to the hospital?
  • What is the likelihood that the physician will be called in during the on-call period?
  • What is the percentage of uncompensated care that the physician will be providing during the on-call period?

This article was adapted from one that originally ran in the July 2009 issue of Physician Compensation & Recruitment, a HealthLeaders Media publication.
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