Most Hospitals Tie Doctor Pay To Productivity; Research Examines How That Impacts Academic Medicine

MUSC is constructing a new $385 million hospital on the the corner of Courtenay Drive and Calhoun Street in downtown Charleston. Meanwhile, a small number of doctors at the hospital are refusing to sign their new contracts, which tie part of their salaries to productivity.


Six years ago, a committee of six professors and three division chiefs at the University of Florida sat down to discuss how doctors employed by the university's academic medical center should be paid.

The existing compensation plan wasn't universally popular. According to new research published in Academic Medicine in August, junior doctors at University of Florida Health were "subsidizing less productive but more senior faculty, which resulted in dissatisfaction with and distrust of leadership."

The committee proposed a new plan, which would tie a percentage of each doctor's salary to the amount of work each doctor does. Moving forward, their productivity would be measured in "relative value units," or RVUs. More patients, more tests and more procedures generate more RVUs.


But RVU targets aren't universally popular, either.

Some patients argue that RVU goals force physicians to work more quickly, thereby spending less time with each patient and opening a window for mistakes. Doctors, particularly those employed by academic medical centers, worry that productivity targets offer no incentive for physicians to teach or to conduct research if they're not generating RVUs in the classroom or lab.

The authors of the new study noted that "faculty engaged in research and education become disenchanted without productivity-based incentives for those activities. Thus, productivity-based comprehensive compensation plans can place each of academic medicine’s missions in competition with the others."

Some doctors at the Medical University of South Carolina recently made the same argument.

While a spokesman for the Columbia-based S.C. Hospital Association explained that South Carolina hospitals commonly use RVUs to calculate physician pay, MUSC only made the switch this summer. All physician faculty employed by the MUSC College of Medicine will now be held accountable to an RVU goal. Doctors who fail to meet their goal will not receive full pay.

Hospitals in Columbia, Greenville and Myrtle Beach would not answer specific questions about how they pay their physicians.

Some MUSC departments have tracked physician productivity for years. But the recent change marks the first time MUSC has applied RVU-based compensation across the board to about 950 faculty members. It hasn't been met with widespread enthusiasm.

In an anonymous survey conducted by MUSC's Faculty Senate earlier this year, one doctor said the new plan "destroyed trust between staff and administration." Another said the plan "diminishes the clinical faculty to work-horses." More than one doctor threatened to leave MUSC over the issue, and in late July, 125 of them had not signed their contracts, even though the initial deadline had passed.

The Faculty Senate requested permission from the S.C. Attorney General's Office to hire an outside attorney to represent the doctors in ongoing negotiations with the administration.

Now, it appears the controversy has largely passed. The MUSC Board of Trustees met on Thursday in an executive session to discuss "personnel matters to include compensation and evaluation metrics," but MUSC spokeswoman Heather Woolwine said that the meeting was "completely unrelated to physician contracts" and that only seven doctors had not signed their paperwork. Each of those physicians is currently involved in a "contract dispute resolution process," she said, and will continue to teach and treat patients during this time.

Woolwine would not disclose how many doctors left MUSC over the issue because "College of Medicine leadership is not in a position to comment on individual faculty members’ reasons for departure, as those are personnel matters."

Charleston attorney Michael Gruenloh, who was hired by members of the Faculty Senate earlier this year to represent the MUSC doctors, did not return a message this week.

Woolwine said a College of Medicine task force, which includes representation from the faculty, has been formed to discuss doctors' pay during medical and maternity leave.


"The issue of approved medical leave as it relates to clinical faculty at-risk compensation is one that we are still examining," she said.

At University of Florida Health, the involvement of faculty members from the get-go seems to have made a difference in overall satisfaction with the RVU-based compensation plan, according to the "Academic Medicine" study.

The RVU-based pay plan was implemented at University of Florida Health during the 2013 fiscal year. Since then, the study's authors found that incentives paid to faculty, RVUs and publications per faculty increased.

Researchers also found that about two-thirds of faculty were more satisfied with the new compensation plan than with the old one.

Dr. Robert Hromas, chairman of the Department of Medicine at University of Florida Health who co-authored the new study, said that doctors at his hospital expressed similar trepidation as those at MUSC when the new compensation plan debuted. Now, most of them prefer it to the old system.

When his hospital first discussed implementing an RVU-based system, he estimated fewer than half of all academic medical centers in the United States paid their doctors that way. Now, he said, it's much more commonplace and the situation at MUSC isn't unusual.

"That same discussion is taking place at 50 different public and private medical centers" across the country, Hromas said. "This is a national issue. And physicians are nervous."

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