Revisiting Productivity as a Basis for Compensating Physicians

Article Hfm Revisiting Productivity Web

hfm Magazine

Healthcare organizations have long relied on compensation models that reward physicians for generating work relative-value units (WRVUs). In many if not most cases, the rate paid per WRVU is tied to industry median benchmarks that are published in a variety of physician compensation and productivity surveys. Although there are good reasons for using benchmarks, the misapplication of median compensation per WRVU benchmarks, and the subsequent reporting of results in industry surveys, creates a feedback loop that affects the survey data. Over time, the benchmarks become more and more divorced from the actual economics of the practice, and they are progressively inflated to the point that, in many cases, they are unsustainable.

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