Calculating wRVU rate in PP-Is this fair?

[GoBlueMD]

It is shocking that you are the first ortho employee to think you are being underpaid. This shows the importance with interviewing at multiple places and diving into salary numbers and calculations before signing.

How has there not being a group demand for better pay? if ortho is getting paid $35/wrvu, what are the non ortho docs being paid?

With this market, employee ortho should be starting at 500k gauranteed for 2 yrs with 2 years to build the practice. Then wrvu based at $60+/wrvu.

You should probably leave as negotiations likely won’t go well. There are probably other jobs nearby, though non competes may be an issue.

[TheDangerZone]

To respond to the comments so far:


-When I say "employed partners," I am referring to me and my physician co-workers who are all employees. We are not "partners" in the sense that we have any ownership stake.

-Not making anything close to $800k, although my practice is still building with a long way to go. However some of the other employed physicians in the group are quite busy but are not making $800k either.

-It's not a large corporation. We are a privately owned ortho group (we do have some other msk docs as well, pain, PMR, etc.). The owners of the practice are a few physicians who originally started it plus a minority of PE investors (more recent addition). Owners are definitely making a profit.

First of all, it's great that you felt compelled to ask for advice. So don't feel bad about the answers you're getting.

Based on the numbers you provided, the owners and investors are making a lot of money. Now, they wouldn't employ you if you didn't make them any money at all, but the balance is severely tilted in their favor. Do they own the surgery center you operate at as well? That's another multiple on top of what they take off your collections. Strongly recommend renegotiating or looking elsewhere.

[Tim]

It's a fairly large metro area, but wouldn't necessarily call it desirable.

This is wRVUs (work RVUs). 350k for 10k wRVUs is right.

$350K is way low even for an academic. The only possibility in academic would be Base Pay and then some incentives. You mentioned PE ownership. This is likely the worst case you could choose. Total Comp counts much more than rates, wRVU's or ownership.

[Sundance]

Well good news is now you know… and now You know you can go basically anywhere in the country and double your salary from day 1.. Thats pretty cool.

honestly if you’re a hardworking doc I would be expecting 7 figures in todays ortho world. More if you get lucky.

oh, and if you’ve been taken advantage of to this degree I personally wouldnt even bother trying to work with your current group.

good luck.

[legoman]

Appreciate all the feedback. I do plan to try and re-negotiate new terms. This will include trying to get into a partnership role. I overall do not have high hopes that this will be tilted to my favor. I think the owners/PE investors are all making too much money to divvy up the pie by one more slice.

What I was looking for on here was confirmation that, regardless that this is a private practice, the $/wRVU rate is still a relevant piece of data. I anticipate them saying in the negotiations that 50% overhead is fair/standard in PP and that this is the deal all the other employed docs get.

[Medstud21]

Appreciate all the feedback. I do plan to try and re-negotiate new terms. This will include trying to get into a partnership role. I overall do not have high hopes that this will be tilted to my favor. I think the owners/PE investors are all making too much money to divvy up the pie by one more slice.

What I was looking for on here was confirmation that, regardless that this is a private practice, the $/wRVU rate is still a relevant piece of data. I anticipate them saying in the negotiations that 50% overhead is fair/standard in PP and that this is the deal all the other employed docs get.

you need to leave this job ASAP IMo. This is straight up predatory. As I said, even my own underpaid employed predatory model in a desirable large metropolis, I’m paid nearly twice the conversion rate. I make some more on call so it eases the pain. You’re so far off the median, that there is really nothing to negotiate. I’m not sure how they are getting away with this, my FM friends are making more than that.

PM me if you need any MGMA data to see the real numbers. I have all the Ortho numbers for last few years. I can tell you more about my setup and other jobs that I have come across and have been offered.

[Kamban]

To respond to the comments so far:


-It's not a large corporation. We are a privately owned ortho group (we do have some other msk docs as well, pain, PMR, etc.). The owners of the practice are a few physicians who originally started it plus a minority of PE investors (more recent addition). Owners are definitely making a profit.

The owners and PE group are making a killing off your backs. If you want to continue to get screwed stay. Otherwise leave. An ortho making 350K is laughable if only it was no so pitiable and sad.

[TheDangerZone]

The owners and PE group are making a killing off your backs. If you want to continue to get screwed stay. Otherwise leave. An ortho making 350K is laughable if only it was no so pitiable and sad.

Just FYI OP confirmed that by they would be making 350k for 10k wRVUs not that 350k is their total comp. But yes, ownership is laughing all the way to the bank.

[ACN]

You are getting screwed. And yes, the point of PP is to get access to the ancillary income (MRI, asc, pt/ot, dme). That's $500k-1.5m alone in top PP groups.

You're better off joining the hospital employed for guaranteed $650-1m.

Our employed partnership track surgeons make $350k/yr until they are made equal partners. No tiered partnership.

[cards67]

If it's 50% of collections, I'm curious as to why collections seem so low with majority commercial insurance. We're all assuming you calculated your wrvu's accurately.

[childay]

If it's 50% of collections, I'm curious as to why collections seem so low with majority commercial insurance. We're all assuming you calculated your wrvu's accurately.

This was my initial thought also. Can you trust the collections numbers or is there a billing issue or what

[Tim]

This was my initial thought also. Can you trust the collections numbers or is there a billing issue or what

Very valid questions. But the time and effort to fix those is the responsibility of the owners/PE.
You are better off putting that sweat equity in a different environment. That is their 50%. I would strongly suggest you spend your time finding other opportunities. You and your physician partners are getting screwed. Poor setup for them too.

[DynamicHipScrew]

You are getting screwed. And yes, the point of PP is to get access to the ancillary income (MRI, asc, pt/ot, dme). That's $500k-1.5m alone in top PP groups.

You're better off joining the hospital employed for guaranteed $650-1m.

Our employed partnership track surgeons make $350k/yr until they are made equal partners. No tiered partnership.

Sidebar: has this been adjusted with the recent acceleration in inflation? For how long has this been the standard guarantee?

[Tim]

Sidebar: has this been adjusted with the recent acceleration in inflation? For how long has this been the standard guarantee?

Sidebar to the sidebar: from a volume perspective, how much is the choice to add a physician actually made by the group or is the group more a screening mechanism for candidates that will add volumes? It is difficult for a new fellow to judge demand.

[legoman]

If it's 50% of collections, I'm curious as to why collections seem so low with majority commercial insurance. We're all assuming you calculated your wrvu's accurately.

Yes, this was part of the reason I was posting was to see if 50% is reasonable. My wRVU amounts are given to me by the practice, so I'm not calculating them.

The thing is, if I calculate what % take home collections would be if I had the avg ortho rate of $75/wRVU, it comes out to 97%, which assumes a 3% overhead. I did the same calcs for a few of the other docs and the numbers are around the same. Sometimes the take home would have to exceed 100% of what they produced to get to 75/wRVU.

I'm sure this will be their counter-argument in negotiations. I just don't get it. Like I said, our payor mix is very good. We also have a robust billing dept. On average, our group collects about 25-30% of total billing amounts which I think is pretty typical? Maybe this just shows how big of an impact in PP access to ancillary income is? I'd love to hear some input from others in PP of how their personal professional collections (apart from any ancillary income) compares here to their wRVUs.