Guest Editorial: Incentive pay plans in radiology?
Dr. McGahan is a Professor of Radiology, the Vice Chair of Radiology, and the Director of Ultrasound, Department of Diagnostic Radiology, University of California, Davis Medical Center, Sacramento, CA. He is also a member of the editorial board of this journal.
The work relative value units (RVUs) earned by different subspecialties in academic radiology may differ by a large magnitude, according to data supplied by the Association of Administrators in Academic Radiology. This discrepancy in earnings potential may be a source of conflict in large subspecialty group practices. Certain radiology subspecialties are more heavily reimbursed because of their higher RVUs. Interpretations of computed tomography and magnetic resonance are heavily reimbursed while, alternatively, those radiologists who interpret examinations such as plain films are not as well reimbursed because of the lower RVUs per study. Even within a single subspecialty such as abdominal imaging, those performing fluoroscopic procedures (eg, upper gastrointestinal contrast studies) earn fewer RVUs than those interpreting abdominal CT examinations. Should these different earning potentials relate to salary among various specialties? If so, how?
When I entered radiology and ultimately chose a specialty, I had no idea that earning potential could or would relate to RVU generation. I chose a subspecialty based on clinical and academic interest.
At the request of the Dean of our Medical School, we have in place a faculty incentive earning plan. We have often revised the plan since it was originally developed. The incentive portion of our salary is primarily based on RVUs (clinical productivity), and, to a lesser degree, on one's academic and teaching responsibilities.
Conversations with members of our department regarding this plan reveal 3 different camps of opinion. There are those who strongly favor the incentive pay plan and wish to have it include a greater percentage of total salary, and there are those who clearly prefer an even salary distribution, other factors being equal. The majority of our faculty is generally silent on the issue; I assume, therefore, that they fall somewhere between the two extremes. As might be expected, those who wish to have a higher incentive pay are those achieving high RVUs, while others with low RVU productivity wish for an even income distribution. The latter group feels that if they did not perform these less-well-reimbursed examinations, then everyone would have to share equally in interpreting them and so would be "penalized."
The issue of incentive pay versus equal salary distribution is also debated among private practice radiologists. There are multiple combinations and permutations among income plans. In my brief casual survey, it seems that quarterly or yearly bonuses are often given to group partners, in equal amounts, especially in small group practices. Other radiologists believe an incentive-based plan is more appropriate because, as one radiologist quoted, "You eat what you kill." Simply put, this statement means that your salary should be based upon your productivity. Other groups with an incentive-based salary plan have expressed resentment, arguing that if all members work equal hours they should receive equivalent salaries. Some groups take a more pragmatic approach, using more limited incentive-earning potential. However, there is often a differential salary based on call responsibility. In talking to radiologists, whether in academics or in a private practice, this approach seems fairly well accepted, as it reimburses those who routinely perform or interpret studies at 2 AM more highly as compared with group members without this responsibility. Some practices require that certain select criteria be met to obtain full bonuses. These criteria could include prompt signing of reports, attending meetings, and other methods of showing "good citizenship."
In speaking to a variety of radiologists, my sense is that it is difficult to move from one payment plan to another. A radiology colleague of mine in private practice is in a group that switched from an incentive pay plan, in which a portion of his salary was based upon his collections, to a plan in which there was equal salary distribution. Thus, from a year where there was a financial incentive for collection to the next year of equal distribution, he saw a large salary decline while the majority of his partners had a salary increase. Thus, one's opinion stems from which side of the street one is standing on. From his side of the street, he felt he was working longer hours and had higher collections, but because of equal distribution of salaries, had little incentive to continue his very demanding schedule.
Which plan works best? There is no doubt that "one size won't fit all." What I have learned is that when there is a discussion that involves money, there will never be a complete consensus. Some will always perceive themselves as losers.