How Much PTO Should Physicians Get?
Written by Robert Chelle
Spelling out the details of your job is crucial to avoid contract conflicts during the term of your employment.
Written by Robert Chelle
Spelling out the details of your job is crucial to avoid contract conflicts during the term of your employment.
Introduction
Paid Time Off (PTO) refers to the amount of time a person has for taking off from work without being penalized. This typically includes vacations, holidays, and sick days. Physician PTO policies vary greatly as they are determined by employer discretion and union agreements which are a key part of the benefits package.
There are some key factors that all physician PTO policies should include: how much paid time off you get per year; what happens when you take a day or more of your paid time off; what happens if you’re using up your allotted days then go on vacation; and whether or not unused days carry over into other years.
While some have paid leave through the government or state law such as Workers’ Compensation, this type of pay is administered by the employer.
In this article, we’re going to cover:
Paid time off (“PTO”), is several days (within a calendar year) that an employee is entitled to be absent from work. PTO refers to the time off accrued by an employee. The more hours they work, the more PTO hours they get paid for.
Most larger hospital network employers will offer accrual-based PTO. Meaning the physician does not receive a chunk of paid time off at the beginning of each contract year; they accrue a set amount each pay period. Private practice employers generally give time off without accrual factored in.
Continuing medical education (CME) is a type of continuing professional development that helps physicians stay up to date with the latest developments in their field. Continuing medical education can be done online, on site, or through other means such as books and journals.
In the medical field, it is important for physicians to continue their education by attending Continuing Medical Education (CME) courses. The cost of these courses can be a burden on an individual physician’s wallet. To reduce this burden, many employers will cover some or all of the cost of CMEs for its employees.
Continuing medical education (CME) is a type of continuing professional development that helps physicians stay up to date with the latest developments in their field. Continuing medical education can be done online, on site, or through other means such as books and journals. Continuing medical education is not just for physicians either; it also includes nurses, pharmacists, dentists, physical therapists and others who are professionals in healthcare fields. Continuing medical education can help people keep up-to-date on new treatments and technology while keeping them out of trouble when it comes to ethical issues within their profession.
Continuing Medical Education can help physicians keep up-to-date on new treatments and technology while keeping them out of trouble when it comes to ethical issues within their profession. Continuing Medical Education has many benefits so read this article to learn more!
As a doctor, you know the importance of continuing medical education in order to stay current with all of the latest advancements in your field. Continuing medical education can be done online, on site or through other means such as books and journals; some people might take courses that are offered by colleges where they can earn credits towards getting a degree if they want one. This is important not just for physicians but also nurses, pharmacists, dentists, physical therapists and others who are professionals in healthcare fields.
The requirements are variable but typically require 20 hours per year with many employers requiring more than 40 hours annually.
Credit for completed CME activities is often provided by a sponsoring organization. For example, a medical association will provide credit for time spent listening to presentations at their annual meeting – and this information can be used on the physician’s CV or in seeking out new employment opportunities with other organizations.
At a CME conference the physician will see many lectures and posters on different topics in his or her field. Continuing medical education is an opportunity to hear from experts about a topic that can be difficult to stay up-to-date with without reading extensively.
A conference may also have opportunities for networking, sharing experiences, discussing new developments in one’s practice area with other physicians who specialize in the same type of care as you do.
Most CME conferences offer more than just talks and posters: they often include hands-on workshops where participants learn how to apply important information learned during previous sessions; lunchtime discussion panels provide attendees the chance not only discuss what has been presented but also voice their opinions publicly for feedback; social events are another way that some organizations foster lasting relationships.
Continuing medical education is typically offered in a number of formats, including live events, online courses or webinars, journal articles, books, conference proceedings. CME hours are reported on Continuing Medical Education (CME) certificates that can be printed and shared with employers.
Each state licensing board requires certain Continuing Medical Education credits to be completed yearly in order for a physician’s license to stay valid. To get these Continuing Medical Education credits, physicians might have to do things like take courses on new medical developments or participate in activities that are supervised by the board of directors at their place of employment or volunteer work.
CME hours are reported on Continuing Medical Education (CME) certificates that can be printed and shared with employers. Continuing medical education is typically offered in a number of formats, including live events, online courses or webinars, journal articles, books, conference proceedings.
The physicians will need to report their CME credits earned according to the guidelines set forth by their state board. A physician may choose from one format for completion such as attending two lectures at an annual meeting while another might prefer completing twelve three-minute videos over six months time period; these options reflect different levels of learning intensity, but both would qualify as reporting 12 hours for this example year since they represent equivalent academic value.
In the wake of COVID-19, many employers are struggling with how to keep their employees working amid pandemic fears. We have covered some possible options for avoiding layoffs or furloughs: The Families First Coronavirus Response Act (FFCRA), the Coronavirus Aid, Relief and Economic Security (CARES) Act, and local/state laws that provide incentives for employers who want to retain workers during a time when it is not clear if there will be any new cases in this area. No one knows what might happen once we get out from under this terrifying pandemic but hopefully these measures can help us ride through until things settle down again!
In the event of COVID-19 pandemic, employers need to remain mindful that a time will come when they’ll have no choice but to let employees go. As such, it’s important for companies and organizations alike not only plan ahead so there are sufficient funds in place during this difficult period; we also encourage them put together an employee retention strategy now before any layoffs or furloughs take effect later on down the road.
Employers must account for both financial issues relating back to funding as well as consider how best handle their work force should one be forced into dismissing staff due foreign contracts drying up from being cancelled all because of COVID-19 pandemic fears sweeping through society like wildfire.
Some employers worry about how their policies will be affected by the pandemic. Employers should consider whether they can and should make adjustments to account for post-pandemic business needs, such as a shorter work week or taking more time off than usual in case of illness. While an employer may not feel comfortable with giving employees additional paid leave right now, it is worth considering what changes need to happen if your company survives the outbreak without being too negatively impacted financially on top of potentially losing many human resources due to illness during that period.
The United States has a lot of holidays celebrated by American workers. With so many options, it can be tough for employers to figure out which ones they should observe with paid time off and how best to handle the situation within their PTO and/or vacation policy. Some are recognized at federal levels such as Christmas Eve or New Year’s Day while others like Labor day might only apply in certain states but some businesses choose not to provide any type of holiday observance because they have clients who work 24/7 year round!
Small business owners are faced with a difficult decision: how to balance their employees’ demands for time off and the need to keep costs down.
A lot of factors should go into your company’s decision of which holidays should be paid days off, such as which ones your employees really want off and how offering them will impact your bottom line.
In the United States, there are a number of days designated as “federal holidays,” which means that all government agencies and banks have to be closed for business. Some private sector businesses may choose to remain open on these public holidays, but they aren’t required by law. The federal government hopes non-government companies will observe this holiday too – it’s not illegal!
There are 10 federal holidays that government agencies and banks close their doors for each year. Many private companies also grant paid time off to employees on these days, treating them like any other day of the week in terms of scheduling.
Although it is usually up to individual employers whether they want or need people working during bank holiday weekends (such as Labor Day), most will give a four-day weekend so workers can enjoy all three days with family members or friends without having work obligations hanging over one’s head.
Many people are unaware that there is a wide variety of state-specific holidays. The list includes the 10 federal holidays, but also varies from one region to another and can include as many as 14 in some states! One example of this is New Jersey where each city has its own set which ranges between 4 and 11 days per year depending on location.
Public holiday laws for individual cities or regions vary widely by jurisdiction; California’s public sector employees have an average of nine designated paid leave days annually while Illinois’ totals only six–not including typical vacation time allotted during working years.
Contracts are a pervasive and obligatory part of nearly all business and legal transactions. Well-drafted contracts help to enumerate the responsibilities of the involved parties, divide liabilities, protect legal rights, and insure future relationship statuses. These touchstones are even more crucial when applying their roles to the case of a physician employed by a hospital, medical group, or other health care provider.
While contract drafting and negotiation can be a long and arduous process, legal representation is a must in order to ensure that your rights are being protected.
The present-day conclusion is simple: A physician should not enter into any contract without having a physician contract review by legal counsel.
There is simply too much at risk for a physician to take contract matters into their own hands. In addition to the specific professional implications, contract terms can significantly impact a physician’s family, lifestyle, and future. There are many important contract terms and clauses which can present complex and diverse issues for any physician, including:
Additionally, often times the most influential terms and clauses in any employment contract are the ones that are not present. With the advent of productivity based employment agreements it is imperative that any physician have an employment agreement reviewed before it is executed. Attorney Robert Chelle has practical experience drafting and reviewing physician contracts for nearly every specialty.
New residents, attending physicians, doctors entering into their first employment contract or established physicians looking for new employment can all benefit from a thorough contract review. By employing an experienced attorney for your representation, you can insure that you will be able to fully understand the extensive and complex wording included in your contract. By having a full and complete understanding of the contract, you will be in a better position to make your own decision on whether or not you want to enter into the agreement which will affect your career life for years to come.
The financial benefits gained, including vacation time off and relocation assistance, from having your contract reviewed and negotiated by an experienced healthcare attorney far outweigh the costs associated with a review. You are a valuable resource, and you should be treated and respected as such. Attorney Robert Chelle will personally dedicate his time to make sure that your are fully protected and will assist you in the contract process so that your interests are fairly represented.
Every physician contract is unique. However, nearly all contracts for health care providers should contain several essential terms. If these essential terms in the contract are not spelled out in contracts, disputes can arise when there is a disagreement between the parties as to the details of the specific term. For instance, if doctors are expecting to work Monday through Thursday and the employer is expecting the provider to work Monday through Friday, but the specific workdays are absent from the Agreement; who prevails?
Spelling out the details of your job is crucial to avoid contract conflicts during the term of your employment. Below is a checklist of essential terms that contracts should contain (and a brief explanation of each term):
Coming into a new organization with a favorable contract can put the physician in a positive financial situation for years to come. Before you sign the most important contract of your life, turn to Attorney Robert Chelle for assistance.
If you have questions about your current medical malpractice policy or are interested in having your employment agreement reviewed contact Chelle Law today.
What is a physician incentive bonus? This can be calculated in several different ways, and we’ll just kind of walk through each of them. There are some physician contracts that are just a straight base salary, meaning, you make $200,000 a year, there is absolutely no productivity bonus, there’s no way to make any more money. It’s just you get this money; you do the work and that’s it. Then there are other models which I think are kind of smarter which incentivizes the physician to be more productive, meaning, either have more encounters or maybe do higher ACU cases. I mean, it really depends, but the two normal ways of giving a physician an incentive bonus is either through a percentage of net collections or RVU production.
Let’s kind of hit both of those. In some physician contracts, there’ll be incentive that states, if the physician takes in, meaning, the practice collects a certain amount of money from the physician services, the physician will get a percentage of that. A few normal ways of doing it is, let’s say, the physician makes $240,000 a year. The practice will state, once the physician has collected 20,000, covering their base salary, they will then get a percentage of what’s collected after that. In that scenario, it would be normally somewhere between 20% to 30%. I would say 25% is probably the normal amount in that scenario. And that would be a monthly way of doing it. The employer could also do it quarterly, they could do it semi-annually, it’s rare to do it annually.
Most physicians don’t want to wait until the very end of the year to receive a giant bonus check. They would prefer to have it doled out throughout the year. That’s a normal way of doing a net collections bonus incentive. With an RVU model, the employer will set kind of a base threshold of RVUs. If you don’t know what an RVU is, it’s a relative value unit. I do have a few videos that you can investigate, but each specialty has an average annual RVU production. And let’s just say, the employer says, you must produce 6,000 RVUs in a year. They would then likely move that down to either a monthly or quarterly production. So, if they had to do 6,000 a year, then that’s 1,500 a quarter, and then, they would say, alright, any RVU produced over 1,500 in a quarter, then you would just multiply the RVUs above that times a compensation factor number. That’s specialty dependent.
It can be anywhere from $35 all the way up to $80. Let’s just say the physician was to produce 2,000 in a quarter, then you would just take the 500 RVUs above that threshold, times the compensation factor. And then, the physician would receive that as a bonus. Once again, normally, I’d say the most common way of doing it is quarterly. And then there may be reconciliation at the end of the year. But those are the two most common ways for a physician to receive a bonus incentive. There are hybrid models that you could do as well. There are also some physicians who just get paid on production, so they just get net collections percentage, or they just get the RVUs they produce.
I think a hybrid is maybe for morale purposes, the best way of doing it. The physician has kind of the security of, alright, this is the minimum amount that I will make, however, if I am either productive or ultra-productive, I can then receive much more. And it just makes sense. I think incentivizing employees in any business is just a smart way of handling things. It’s a good business model and I find most employees appreciate it as well.
How are physicians paid in a productivity model? First, there are multiple ways of calculating productivity for a physician. And then, of course, there are multiple ways to compensate them for that. I think there are four main areas and we’ll hit all of them. One, you have just a straight net collections-based contract, you have just a straight RVU production contract, you have a hybrid of base salary plus net collections, and then a hybrid of base salary plus RVU production. We’ll just kind of go over the basics of all four of those. First, straight net collections contract. What that would mean is, anything that is collected by the practice for the physician services, the physician would get a percentage of that.
The general percentages are somewhere between 35% to 45% of their net collections if it’s a pure net collections-based agreement. 45% is on the high side, but I’ve seen from 35% all the way up to 45% if it’s only based on net collections percentage. Some of the downsides of this are, at the beginning of the agreement, the physician is going to see almost no compensation for a period. The average accounts receivable cycle for an insurance claim is somewhere between 30 to 90 days. And so a physician who is just being paid on net collections could be working for a month, but none of that money is collected for two months afterward. So, the physician could theoretically make $0 in the first couple of months of the agreement. In that situation, sometimes we’ll have a base draw, maybe for the first three to six months.
And then that money given to the physician will be taken out over time, just so that they’re not working for no income for a period. Is this a fair way of being compensated? Sure. I think it’s also volume dependent. You also must rely upon the billing and collecting efficiency of the practice that you’re with. Some specialty, dermatology comes to mind, where these seem to be much more prevalent than others, but that’s kind of the net collections productivity. Second, the RVU production only. I have several videos on RVUs if you don’t know what those are, but essentially for every encounter, there is an RVU value assigned to it. And then, the physician is paid their RVUs produced times a compensation factor. So, a numerical or monetary value, usually between $35 all the way up to $80, it is specialty dependent.
And whatever the physician would then produce in RVUs, usually monthly, the calculation is simple. That would be RVUs times the comp factor, and that’s how much they would make. The benefits of RVU versus net collections are, in net collections-based agreements, it’s only what the practice gets, so insurance write-offs, defaults by patients who just simply don’t pay the bill, as I said before, inefficiency in billing and collecting. All those things can affect what the physician makes. If it’s a net collections based and RVU based contract, the physicians are only paid for what they do, collections have nothing to do with it. So, the physician will likely benefit from an RVU based production model versus collections because all the bad debt doesn’t matter. Now, most private practices don’t use RVUs.
They use net collections. It’s the hospitals and health networks that would use RVU based compensation, keep that in mind. Is one better than the other, meaning, net collections versus RVU? It’s situational dependent, but those are kind of the first just pure product productivity-based agreements. Third, a hybrid of base salary and net collections. A couple of ways of doing this would be, first, the physician would get a base salary, and then each month that their net collections exceed their base salary, they would then get a percentage of that. That would normally be a smaller percentage, usually between like 20% to 30%. So, if they’re making $10,000 a month, once their net collections for that month exceeded $10,000, then they would get 20% to 25% of what was collected after that.
That’s a normal way of doing kind of a hybrid base salary plus net collections. They could also just come up with threshold. Maybe their base salary is less than the amount. Let’s say, even though their base salary would be $10,000 a month, they may say the net collection’s threshold is $20,000, but then they get a much higher percentage, maybe 50% of net collections after that. Once again, kind of depends upon the situation specialty, but that’s a normal way of doing it for a hybrid net collections model. And then, the last model would be base compensation plus RVU production. Once again, they would have a base salary and again, let’s just say, it’s $10,000 a month.
And then, they would come up with an annual target for their RVU production. Let’s say it’s a family practice, and the baseline is 6,000 RVUs per year, then they would just divide that either by monthly or quarterly and anything that they generate above a certain threshold, so if the expectation is 6,000 a year, then you would just divide 6,000 by 12, and then any RVU generated above that per month, that’s when they would receive the bonus. You would take the RVUs produced above that amount times whatever the compensation factor is. The benefits of the hybrid model obviously are, there’s kind of less variability and the fact that they will have a base, so that there’s a minimum amount that the physician will make, but then there are also bonuses on top of that as well.
Once again, it’s specialty-dependent, but most physicians don’t like the potential downside and variability of maybe making much less than a month than others. For instance, if you’re a physician who is taking a lot of time off in a month, there is a good chance that, let’s just say, someone takes a two-week vacation, well, if you’re being paid purely on collections or RVUs generated in a month, that month is going to be much less than you would make in other months. And some people would prefer just kind of a steady-state and if they outperform that then they would get more. So that’s kind of how physicians are paid under a productivity model.
I’m going to talk about some examples of moonlighting for a physician. There are two things to think about. When a physician signs an employment contract, it’s very likely there’ll be a clause in there that is listed as either exclusivity or outside activities which prohibits the physician from doing any kind of moonlighting, locums, side work at all involving the practice of medicine without getting the written approval of the employer. We’re going to get into that in a second. Now, moonlighting as a physician in general, means they are working for another employer outside of their main full-time job. Shift work, specialties are probably the ones that do this the most.
So, ED, hospitalists, if they’re working seven-on/seven-off, which is a normal schedule for an emergency medicine physician or a hospitalist. If they have that seven days off, then many times, they’ll want to pick up shifts elsewhere. And in that case, that would be considered moonlight. Now, going back to if a physician is employed, let’s just take a hospitalist employed by a hospital. The physician is employed with a hospital and signs an employment agreement. The employment agreement is going to state this is your exclusive employment, this is your full-time job, this is the only job you can have without getting our written approval in order to do something else. In that situation, if the physician wanted to work outside the organization, maybe doing some locums or picking up shifts at another local hospital, the employer would have to say, yes, we agree that you’re allowed to do this.
And it’s fine. Now in that scenario, if an employer says the physician can moonlight, then usually there will be a couple of things the physician must do. First, the employer will likely require that the physician provide proof of professional liability insurance, malpractice insurance to their employer. If a physician is working outside of their full-time job, that employer is going to say, look, yes, you can work elsewhere, but you need to show us that you have malpractice insurance for that job specifically. The malpractice insurance is employer-specific for a physician. A physician doesn’t just have one malpractice policy that covers any practice of medicine anywhere at any time. That’s not how it works. It’s employer specific. So, the physician will have a malpractice insurance policy for their full-time employer. And then if they’re going to moonlight, locums, whatever, they would have another professional liability insurance policy that covered that employer as well.
Many employers just don’t want to deal with issues if that physician isn’t insured or maybe the physician doesn’t even understand that they need insurance for that position. Whoever is hiring them to do moonlighting should know that they need a different policy as well. But that’s one of the main concerns why employers don’t let people moonlight or do locums without having proof that they’re going to be insured in that position. Another consideration is competition. Many employment agreements will state that the employee cannot compete with the employer during the term of the contract, and after the contract terminates as well. It can state specifically, no matter what, you cannot work with a competitor organization during the term of this agreement. And that could be different than the actual non-compete, which will then take effect after the agreement ends. Let’s just take the hospitalist as an example as well. The hospitalist works for one hospital. The employment agreement could state, you can’t work as a hospitalist within the county that the hospital is in or within 15 miles or something like that.
If you think about it, there’s no competition amongst shift work physicians, and people that work in the ED or hospitalists. It’s not like you’re going to steal a patient base from a hospital or anything like that. The biggest concern would be, let’s just say someone was a primary care physician employed by a hospital. Their clinic is off campus somewhere. What they wouldn’t want to do is have that physician work at another primary care practice in the area, maybe just on the weekends or something like that, build up at least some kind of patient base and then potentially terminate the contract with the employer and then move over to whatever job they were moonlighting with and maybe take the patients with them. Now, there will be other clauses in the contract that prohibit that. There will be a non-solicitation agreement.
As I said before, there’ll be a non-compete, but in the non-shift work positions, the fear of the employer is that if they are going to do moonlighting, they will establish presence somewhere else, and then ultimately take those patients with them when they leave the original employer. Moonlighting can also take the form of, once again, let’s say there’s a hospitalist that works at one hospital, however, they’re in a larger network. And then there are other hospitals within the network that they could pick up shifts at as well. In that scenario, normally, you would not need written approval to do that. Most contracts will state the providers are allowed to pick up shifts within the network without any need for approval.
Because normally, the malpractice policy would cover all the network, not just one hospital. And so in that scenario, it would be fine that the only reason why, once again, let’s say it’s hospitalists, they would want to pick up shifts elsewhere, outside the network. Let’s say they have an opportunity to pick up additional shifts either at their own hospital or maybe in other hospitals in the system. Why would they go outside? Well, it’s money. You’ll generally get paid more if you’re working in a locum tenant’s position. And maybe you’ll make 1500 a shift within the network, but then if you work a locums job, you’ll make 2200 shifts, something like that. So, that physician would want to work outside the organization simply because they can make more. Anyway, that is some examples of moonlighting for a physician.