Payment and hours of service benchmarks for medical directorships are available from several sources. However, in today’s health care environment, facilities need physicians for a number of reasons, and it can be difficult to convince a physician to give up time to sit on a committee, serve as a medical staff officer, train for CPO or EHR, help with peer review or participate in quality initiatives. Establishing a fair and compliant payment rate for a position that does not need a particular type of specialist can be a challenge!
Be Wary of Opportunity Cost
In positions where specialty is not a requirement for the role, such as EHR implementation, quality initiatives, utilization review, or chief of staff, many valuation experts advise that opportunity cost should not be considered a factor in physician payment rates, and FMV for clinical services may differ from administrative services.
Federal Register comments on Stark III regulations state:
A fair market value hourly rate may be used to compensate physicians for both administrative and clinical work, provided that the rate paid for clinical work is fair market value for the clinical work performed and the rate paid for administrative work is fair market value for the administrative work performed. We note that the fair market value of administrative services may differ from the fair market value of clinical services.
Hours Vary
Many hospitals and health systems set a standard hourly rate for all physician administrative contracts, sometimes paired with a FMV opinion on that rate. This can be an effective policy, however, it does not negate the need to define and monitor the hours associated with each position since total payments must also be reasonable. Ensuring that the job description justifies the hours, and that time records are kept, collected, and reviewed is essential to a robust compliance process.
Hours among non-director positions tend to vary since the variety of assignments is broad. Meeting frequency, residency or teaching duties, nature and scope of quality initiatives or intensity of training for IT, POE or other training programs each vary by institution, subject and physician role, hence good recordkeeping is essential. Committee chairs and administrative/initiative leaders of non-clinical initiatives often require more hours than non-leaders as well.
The graph below shows the variation between types of non-clinical administrative positions:
To learn more about paying for non-director administrative positions, email us at resources@mdranger.com.
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