5 Trends Impacting Physician On-Call Compensation

In the last decade, physicians have increasingly expected their affiliated hospitals to provide compensation for on-call coverage, payments that vary by region, physician specialty and local provider shortages. Here are five trends affecting physician on-call compensation in hospitals.

1. On-call pay expenditures have increased.
According to Sullivan, Cotter and Associates' 2010 On-Call Pay Survey Report, 55 percent of survey participants reported their physician on-call pay expenditures had increased in the past 12 months. From 2007-2010, median on-call expenditures reported by trauma centers more than doubled, from $1.2 million in 2007 to $2.4 million in 2010. Non-trauma centers also reported an increase, though a less substantial one: Median on-call pay expenditures increased from $433,849 in 2007 to $798,000 in 2010.

2. More physicians expect on-call pay than in previous years. According to Kim Mobley, managing principal with Sullivan, Cotter and Associates, the increase in on-call pay expenditures can be partially attributed to the expectation of on-call pay among physicians. The majority (95 percent) of survey participants reported providing on-call pay to at least some non-employed physicians with admitting privileges, and 65 percent reported providing on-call pay to their employed physicians.

Ms. Mobley says expectations around on-call pay have changed over the last decade. While historically physicians were expected to provide call coverage as part of their affiliation with the hospital, physicians are now asking for extra compensation to treat patients outside clinic hours. Ms. Mobley adds that some hospitals have started paying for excess call only, a seeming compromise between the extremes of no compensation and payment for every case. According to the Sullivan, Cotter and Associates survey, around 27 percent of survey participants indicated they use only excess call to pay for coverage.

"For example, [the hospital] would expect a physician to provide so many shifts per month of call coverage, and beyond that, you get the pay," Ms. Mobley says. This arrangement benefits physicians who take call coverage "above and beyond" the expected amount, such as physicians in communities where a shortage of a certain specialty exists.

3. On-call pay depends on physician specialty and shortage.
The level of on-call pay depends on physician specialty as well as the number of available physicians in the community. Medical Group Management Association's Medical Directorship and On-Call Compensation Study: 2011 Report Based on 2010 Data found that invasive cardiologists reported the highest median daily rate of on-call compensation, at $1,600 per day on call. General surgeons earned a median of $1,150 per day, while urologists clocked in at $520 per day for on-call coverage.

The Sullivan, Cotter and Associates survey also found a significant difference between physician specialty, with a reported median hourly on-call pay rate for stroke neurologists sitting at $20.83 compared to $12.50 for ophthalmologists. Ms. Mobley says the difference in pay can be attributed to the amount of call coverage required and the likelihood of being called in. "If you think of a trauma surgeon, when they're on call, there's a pretty good likelihood they'll be called in to provide services relative to perhaps a gastroenterologist or urologist," she says. This also means the level of on-call pay does not necessarily correlate to a specialty's annual average compensation, hence the low rate of $12.50 per hour for ophthalmologists.

Call coverage payments will also be higher in communities where specialists are in high demand, Ms. Mobley says. A physician who knows he is the only neurosurgeon in a community can demand higher compensation levels because the hospital requires his services to treat emergency stroke patients, for example.

4. Payor reimbursement and type of facility affect pay levels.
Payor mix and facility type affect on-call coverage compensation, as physicians are likely to want more payment if they know their reimbursement will be limited. If a physician is providing call to an urban trauma center with an underserved population, he or she may expect a higher on-call pay stipend because reimbursement for the population is lower. In this case, compensation levels will be determined through benchmarking against facilities with similar payor mixes.

5. Payment for telephonic coverage is increasing. In some cases, a physician's consult may be more important than his or her presence at the hospital. According to the Sullivan, Cotter and Associates report, 15 percent of organizations said they provide telephonic call coverage to physicians who are not required to be at the hospital. Unsurprisingly, the decreased strain on the physician providing telephonic call coverage means payments are lower: Around 20 percent of organizations reported they only pay a portion — typically 55 percent — of the normal unrestricted on-call rate.

Learn more about Sullivan Cotter and Associates.

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