nurse practitioner productivity bonus formula

Make sure that the charges providers are being paid for are correctly reflected in the documentation. Would it be the median multiplied by 30% then the percent of clinical effort? I was nave back then, so I didnt understand the ramifications of having a salary/bonus cap. If you have any questions, feel free to ask and I will look for answers! State practice . Collections rate = Collections divided by billings. (2008). For example, suturing a 1 cm laceration does not take as long as suturing a 9 cm laceration. Acute care specialists work in emergency rooms, intensive care units, and urgent care clinics. If you are a nurse practitioner paid based on your productivity, the RVU is the number used by your employer to determine exactly how much you will be paid. Full-time total median income which includes base salary, productivity bonuses, incentive payments and more of $120,000. Hopefully you can figure out which one the target is based on by the numbers. Remember that total RVUs and work RVUs are two different things. This incentizes you to see patients and maximize billings. From my experience, most bonus incentives are either based on the mid-level providers collections or work RVUs. 2. In some contracts, the bonus is "optional"; that is, the employer can give one, or not, at his or her pleasure. If you bust your ass, your pay stays the same. Thanks Justin. Experience is also a critical factor. That was my impression from what Ive read here, however Ive never dealt with RVUs in the past. It is the same thing with a production model. Massachusetts average nurse practitioner salary: $122,740. For example, a provider could work hard to generate $373,421 in gross charges, but if the practices collection rate is less than 93%, they wouldnt hit the breakeven mark and miss out on a bonus payment. Trainees receive a salary during program; Trainee benefits include vacation days, continuing education spending allowance, health/vision/dental insurance enrollment, and 401K enrollment . Physician owners need to think critically about how they structure compensation plans for mid-level providers. The percentage the employer offers the employee varies greatly, from 1% to 50%. PMC Your operating expense ratio is equal to operating expenses divided by net receipts. I am an endo NP so I bill 99913 and 99914. * Maintain consistent level of productivity. AUTHORITY: 38 U.S.C. Physician Productivity Bonus Model: A Hybrid of Work RVUs and Encounters. How would you negotiate RVU for quarterly bonuses? And if so, is it based on collections? I have previously only been part-time in private practice or FT in hospitals. This is a huge advantage compared to earning a percentage of collections. I just got introduced to your page by a friend who has a booming private practice in San Antonio Texas. It is that simple. HHS Vulnerability Disclosure, Help I see that they are seeing less than 15 patients in 9 hours/ day. Using our example above, a standard office visit for hypertension involves very little legal risk on the part of the provider. But were not supposed to discuss compensation with each other, so I want to be able to present my argument without using that. Productivity among healthcare providers is calculated using a measure called the RVU (Relative Value Unit). Per the article: be sure you are getting paid per RVU at $32 per RVU at a minimum. This includes their base salary, payroll taxes, and any other benefits that you will include in their contract. A minimum to reach per quarter? Riskier procedures and diagnoses are ranked higher on the RVU scale than those that incur little risk. It is imperative that nurse practitioner students are educated and . I think $150k in revenue per quarter is totally reasonable for a busy practice. By 2025, you need a DNP to become an APRN. What should I ask for, in terms of a bonus structure? $35 per patient is similar to the RVU model, but that seems awfully low to me for hospitalist work. Also, these larger practices and corporations cant really keep track to see if the insurance actually reimbursed for the RVU you produced. You can make $500k+ easily. You get paid regardless of how busy it is. 9/30/10 6:56 AM . Mid-level providers, such as nurse practitioners and physician assistants, are in high demand. Your email address will not be published. Two thousand billable hours will bring in $180,000, of which $60,000 is performance-based revenue. Well use the operating profit margin going forward with our bonus incentive calculation. His work is focused on developing digital practice management resources for independent healthcare providers. We previously calculated generating about 3,648 workRVU per . Where are you coming up with the $32/RVU recommendation? That is just the RVU reimbursement, the actual level 3 visit is billed utilizing an E&M code and that will result in $75-100 average for the practice. Tyler is passionate about helping small business owners lead and manage effective teams. Nurse practitioners' job satisfaction and intent to leave current positions, the nursing profession, and the nurse practitioner role as a direct care provider Article Nov 2010 The two part equation is as follows: Each year, Medicare adjusts the conversion factor directly affecting how much healthcare providers are paid. My employer has mentioned the possibility of offering me a bonus if I achieve a specified level of productivity. Pay The median annual wage for registered nurses was $77,600 in May 2021. Is the information provided above a basis for calculating encounters and RVUs for target goals as well or is this only to be used for a bonus or reward model. Avg. I need help! Required fields are marked *. What are the benefits of hourly pay or salary? From my experience, smaller practices generally pay by collections because of its simplicity. The $347,282 break-even amount will be the minimum threshold for our bonus incentive calculation. On the low end, mental health counselors and marriage and family therapists earned a 25th percentile salary of $34,550, meaning 75 percent earned more than this amount. Are RVUs generated on these 99024 no charge visits? I dont know exactly how many RVUs theyre producing, but they are getting the bonus each month, which means it takes less than 387 RVUs per month to break even on their salaries. Knowing this, we can calculate the level of collections that our mid-level provider needs to produce before they start generating profit for the practice. I hope this post helped you understand how to structure a simple bonus incentive. As the practice owner, you break-even on your investment when the total direct costs of your mid-level provider are equal to the profits that they generate for the practice. You do not have to produce to receive payment. Using this formula, primary care nurse practitioners see an average of 24 patients per day and are reimbursed an average of $70 per patient. . So if youre saying Im generating a value to the practice of $32 per RVU, if I hit 2656 RVUs per year (my salary of $85k / $32 per RVU) then every RVU over 2656 should be received in a form of bonus at $32 per RVU? Keep this in mind. sharing sensitive information, make sure youre on a federal Am I generating much revenue? For team-based practice models, all providers should be held accountable to the combined wRVU target. Afterall, you dont make an investment just to break-even. The chart below shows an example comparing the three part breakdown of the RVU of a standard office visit, a diagnostic colonoscopy and a total hip replacement. You can break through the ceiling. I may be joining a very high-production private specialty practice. What is the expected volume per day? Collections: Think about how much you generate for a practice and then what the overhead is for the practice. This is the only job Ive had that pays a bonus structure and Im still trying to figure out how much to ask for and what a normal revenue is for a Nurse Practitioner. Most visits you should be generating 1.5 RVUs though, therefore now that number goes up to $172k a year. To update your cookie settings, please visit the, Diagnosis and Management of Vocal Cord Dysfunction. Accordingly, before you sign that contract, it's essential to understand all of the terms. According to the BLS, the mean annual salary for NPs was $114,510, or an hourly rate of $55.05, as of May 2020. This contract came from a dermatology practice: For each 12-month period beginning on Provider's commencement date, the Practice will pay Provider a base annual salary of $170,000 per annum. Its been very valuable especially when deciding to become an independent contractor. Straight pay plus a bonus will guarantee a certain amount, but it wont be as lucrative, so see what the patient volume is like at these facilities. I am asking because I am new to this and I have a report from last fiscal year that shows target encounters and RVUs however I do not know how it was calculated. Do they have to disclose this if I ask? The total combined income is $168,051 between salary and benefits. On-Call All Specialties, Full Time Only Based on all years of data: Number: 4466: based on all years of data: No Call: 61% : Phone only: 18%: of which 20% are additionally compensated for this If you can get a large percentage of collections such as 60%-70% then go for it. Nurs Outlook. How do you compare 1 position that is straight productivity after a year versus a position that is straight pay with a bonus 2xyear? Once I meet the base pay I would make 30% of collections in quarterly bonuses ? I do this for my telemedicine practice. Thanks for your response. Our charting system is able to give me information about my productivity but I dont really understand how to interrupt it. For practice models in which the AP bills independently, the AP should be eligible for wRVU-based productivity incentives. Unable to load your collection due to an error, Unable to load your delegates due to an error. "><\/script>'); In addition, Provider will be entitled to a bonus equal to eighteen percent (18%) of the Net Collections (gross collections less refunds, overpayments, penalties assessed, and the cost of the supplies) received by the Practice during each Contract Year for services rendered personally by Provider in excess of $340,000. Additional experience may substitute for master's degree, to the extent permitted by the JHU equivalency formula. It would be under the providers profile. Recent research shows that in the past decade, the relative growth of nurse practitioners (NPs) and physician assistants (PAs) in community health centers (CHCs) has far exceeded the growth of physicians (Ku & Bysshe, 2015).Studies also show that there is wide variation across different types of organizations in their productivity (Xue & Tuttle, 2017), CHCs in particular (Park et al., 2020). Is this a reasonable agreement or am I thinking too deep into it? For the visits that you dont get paid anything, I would advise being compensated at least 1 RVU for your time as it helps the doc be more productive. I know a couple of my peers make $140k+. The other problem though was that they also capped the bonus! And if I can find out what I billed all last year, I should be asking for at least 50% in salary? Click the topic below to receive emails when new articles are available. The relative value unit: History, current use, and controversies. Do you have a bonus incentive plan for your mid-level providers? Things like rent, utilities, administrative staff salaries, maintenance, equipment leases, legal and accounting fees, and supplies are all examples of operating expenses. You earn $32 per RVU, once your base of $129k is met, every $32 RVU earned after that is then paid out as a bonus. Please enter a Recipient Address and/or check the Send me a copy checkbox.