Download - AMGA CFO presentation
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University of Utah Community Physician Group (CPG)
Overview
AMGA CFO Leadership CouncilOctober 15, 2015
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CPG Overview
• University of Utah Primary Care providers practicing in 8 U of U Health Care clinics
• 77,000 Primary Care patients along the Wasatch Front• Group has experienced growth over the last several years
• 7.9% 5 Year CAGR Professional Net Payments• 7.1% 5 Year CAGR wRVU (Productivity)• 8.9% increase in year over year visits
• Steady increase in Medical Staff – adding 10 CRNA
2012 2013 2014 Mid Year 2015204060
80100120
61.56
81.46 90.19101.4
# of CFTEs in CPG
# of CFTEs
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CPG Footprint
N
Lehi-Future location
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2013 Health Science leadership commissioned CPG to develop a new compensation plan
The new plan would need to focus on:• Simplicity • Compete more effectively in local market• Align more closely with national benchmarks• Incent for quality and productivity• Establish minimum productivity standards for
organizational financial stability
Initiative
CPG Compensation Model
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1st step was analysis
CPG hired 2 consulting firms to evaluate:• Our current plan • Our readiness to make change • Our financial status
CPG Compensation Model
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Consultant conducted a survey in December 2013 asking 19 representative providers for feedback on:
• strengths/weaknesses of current compensation plan • morale level regarding compensation• readiness for change • opinions on future compensation plan design
Readiness & Provider Feedback
CPG Compensation Model
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Consultant Results:
Other weaknesses:
• Effectively no PTO
• Perception that bonus program is not sustainable in terms of funding
Other weaknesses:
• Tenure not recognized
• Not able to use best important quality metrics
• Specialists are different from primary care
• Don't like lag in setting base salaries as I'm building my practice
• Different fee schedules affect my compensation
• No comp for admin work
• wRVUs don't always recognize increased patient complexity
• Hard to communicate with assigned Financial Analyst
CPG Compensation Model
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CPG Compensation Model
Consultant Results:
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CPG Compensation Model
Areas of consensus
Consultant Results:
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Transparent• Plan is easily understood and simple to administer
Productivity calculation is real time, based on 3-month rolling wRVU average• Approved leave time is excluded (FMLA, Maternity, Military Leave)• Eliminated base + productivity
Alignment of compensation with national benchmarks minus U of U retirement benefits (over the 90th %tile)
• MGMA, AMGA, SullivanCotter 3 year PCP averages
Incent for Financial, Quality, Access, Patient Experience, and Citizenship measures• FY15: Bonus Plan – shared “pot”• FY16: All providers will be included in incentive plan
Key Principles
CPG Compensation Model
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Key Principles, cont.
CPG Compensation Model
Establish minimum production expectation• 50th%tile wRVU minimum expectation (based on the 3 benchmarks)
Hold Harmless• If a provider is at 50th%tile for wRVU then $/wRVU will be equal or better
than current $/wRVU (old plan)o i.e. no wage decrease if on production and at the 50th %tile or greater
• Guarantee salaries will be supported (will discuss in more detail on later slide)
Compensation rates, productivity benchmarks, and conversion factors ($/wRVU) are reviewed annually by CPG Compensation Committee
Compensation Planning and Exceptions • Compensation Committee (Review and Recommend) • CPG Executive Committee (Final Approval)
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Key Principles: The FormulaSimple
• (wRVU x $/wRVU) + stipends*: adjusted by quality incentive• Use 3 month rolling wRVU average
• or (Guarantee): adjusted by quality incentive
Example for 3 months: 300 + 200 + 400 = 900/3 = 300 for 3-month wRVU rolling average
o 300 wRVU x $31.37 = $9,411.00 that month
*Stipends - Based on aggregate time of lost wRVU opportunity due to administrative time (i.e. Clinic Medical Director)
CPG Compensation Model
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New Plan: Key Principles, cont.
CPG Compensation Model
3-Tiered Methodology
Recognize specialty differences• 3-tiers based on specialty wRVU production benchmarks
• < 50th percentile • 50 - 74th percentile• >=75th percentile
The tiers and primary care conversion factors are based on data provided by Sullivan-Cotter (consultant). They sent us 3-year national averages from 3 major reporting agencies.
Recognize primary-care similarities• Use primary care $/wRVU conversion factors
Adjustment of conversion factor to more closely align with compensation targets• Recognition of U of U benefits: % reduction of the national conversion factors
($/wRVU)
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wRVU Tiers, MD DetailProductivity is benchmarked by 3 conversion rate tiers
• Primary care conversion factor ($/wRVU)• Specialty-specific productivity (wRVU)
CPG Compensation Model
FP IM IM/Peds Peds
0-5094
5095-6168
6169+
wRVU Conversion Rate Tiers
TierProductivity
% tileBlended avg
$/wRVU
0-4722 0-4911
4723-5273 4912-5862
5274+ 5863+
1
2
3
31.37$
35.76$
38.26$
<50th 0-4886
50th-74th
75th+
4887-5884
5885+
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wRVU Tiers
3 tiers are used – Annual wRVUs, adjusted by cFTE, are measured
against benchmark tiers – Example: 4000 annual wRVUs at 0.75 cFTE
• 4000 / 0.75 = 5333 normalized wRVU• Compare to 3 tiers• Falls into the 50-75th%tile, Tier 2 $35.76/wRVU
CPG Compensation Model
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Apply Conversion Factor$/wRVU rate from the appropriate tier is then applied to the 3-month rolling wRVU average
• Example continued– 4000 / 0.75 = 5333 normalized wRVU (Tier 2 = $35.76)– 333.33 = 3 month rolling average– 333.33 x $35.76/wRVU = $11,920 monthly salary– $11,920 x 12 months = $143,040 annual salary
CPG Compensation Model
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wRVU Tiers, MD DetailProductivity is benchmarked by 3 conversion rate tiers
• Primary care conversion factor ($/wRVU)• Specialty-specific productivity (wRVU)
CPG Compensation Model
FP IM IM/Peds Peds
0-5094
5095-6168
6169+
wRVU Conversion Rate Tiers
TierProductivity
% tileBlended avg
$/wRVU
0-4722 0-4911
4723-5273 4912-5862
5274+ 5863+
1
2
3
31.37$
35.76$
38.26$
<50th 0-4886
50th-74th
75th+
4887-5884
5885+
* At each annual review, if the next tier is reached, the higher $/wRVU rate will apply to all wRVUs
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wRVU Tiers, APC DetailProductivity is benchmarked by 3 conversion rate tiers
CPG Compensation Model
APC
24.88$
27.19$
29.49$
2 50th-74th
Conversion Rate Tiers
TierProductivity
% tile
wRVUBlended avg
$/wRVU
3525-4277
1 <50th 0-3524
3 75th+ 4278+
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Incentive Plan• Transition from bonus to bonus plan + risk• For providers on production model• Points calculated quarterly
• Financial 10%• Organization Patient Experience Goal 10%• Quality 40%• Access 20%• Attendance & Citizenship 20%
• Up to 5% of quarterly wages at risk • Potential to earn additional 5%• Points are weighted based on productivity tiers
• Points for higher producers will carry a higher $ value
CPG Compensation Model
% Points Earned Adjustment Factor0% -5.0%
25% -2.5%35% -1.5%40% -1.0%50% 0.0%75% 2.5%
100% 5.0%
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Guarantee PrinciplesNew provider guarantees
• Set at 50th%tile CPG conversion rate and national productivity by specialty• Signing bonus available upon Compensation Committee approval • Offered up to 2 years maximum • If provider not able to reach 50th %tile after 2 years, gap coverage supplement,
not salary adjustment, until targets are met
Established provider guarantees• Monthly gap coverage • Guarantee end date is established at guarantee start date• If beyond 2 years past hire date, an individual plan to move to productivity
compensation plan will be approved by Compensation Committee and presented to CPG Executive Committee
• Gap coverage supplement, not salary adjustment, until targets are met
CPG Compensation Model
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Example of New Plan Report
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Business Case for Increasing ProductivityProvider X 1.0 cFTE <25th %tile
• Current wRVU = 3,919.25• 50th %tile wRVU for FP = 4,887• $64.40 wRVU reimbursement rate
Example Calculation:4,887-3,919.25 = 968 x $64.40 = $62,323 in increase net payments$62,323- $34,616 (increased salary Tier 1 – Tier 2) = +$27,707 Net Revenue/year
If all <50th %tile providers in CPG are brought up to the 50th %tile = $1 million net revenue and increase patient access
CPG Compensation Model
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Thank You