04 June 2009

Paying physicians for taking call

One of the major crises facing ER docs nationally is the lack of specialists who are available and willing to take ER call. I understand their reluctance, because it's a huge disruption to their personal lives and their private practices, and it's often an unreimbursed and risky activity. But it's also always pissed me off, since when they shirk this responsibility, it leaves us in the ER holding the bag, trying to figure out what the hell to do with a patient in need of specialty care (usually surgical services) but without the specialists to care for them.

In most hospitals I've encountered, there's this sort of ritualized dance that the hospital and the specialists engage in wherein some specialty group will threaten to stop taking call, and the hospital will threaten to take away their privileges, and the docs will threaten to send their patients somewhere else, they hospital will prevail on their sense of duty, the specialists demand compensation, the hospitals claim it's prohibited, and after several back and forth steps they come to a negotiated agreement to maintain the integrity of the call schedule. The exact nature of the agreement depends on the specialty and the leverage each party brings to bear -- hand surgeons can do most of their work in outpatient centers, so their threat to go elsewhere is potent, but the orthopods can't do their hips & spines without the hospital and thus are not able to exact as many concessions. It used to be unthinkable for hospitals to actually pay doctors to just be on the schedule, but this seems to be more and more common these days. More disturbingly, the greed and raw opportunism exhibited by some of the specialists is appalling. They don't want to take call, so when they get the hospital over the barrel they ask for exorbitant sums, cynically figuring that either the hospital will back off and let them out of call, or if they have to suck it up they'll be well-paid for the inconvenience. I'm talking sums of $1,000-$5,000 per day of call! Fortunately, those are the extreme examples, but you can see how it would become unsustainable pretty rapidly if the hospitals had to pay $365,000 annually just for, say, ENT back-up. Then the neurosurgeons, and hand surgeons, and urologists etc etc would want to get in on that action, and pretty soon you're talking real money.

It's a disconcerting trend, so I was not entirely pleased to see that the Health and Human Services Office of the Inspector General (OIG) had issued an advisory opinion endorsing paying physicians to be on call.   If it makes it less likely that I'll have a call roster full of holes, then that's a good thing, but if it accelerates the stampede to the feeding trough, it might be self-defeating in the end.

Then I read the actual opinion (PDF), and it was actually pretty reassuring.  The background: there are these regulations called the Stark Anti-kickback regulations which basically prohibit hospitals from giving money to doctors to provide referrals to the hospital, and they have been very broadly interpreted to prohibit hospitals from giving any money or in-kind compensation to doctors except for clearly defined and legitimate services provided.  There are a number of "safe harbors" which do allow some payments to occur in defined circumstances.  But being on call doesn't fit into any of these safe harbors.  So some hospital in the town of [REDACTED], which I hear is a lovely place to visit in the fall, came up with a scheme to pay their specialists and asked the OIG for an advisory opinion.  The details are interesting:
  • Instead of paying docs to be on call, they get paid piecemeal for unreimbursed consults or procedures performed while on call.
  • The payment rate seems to be in the low to moderate range ($100-350 per).
  • The arrangement is open to all docs on call and not just to certain favored specialties.
The OIG took an interesting step beyond "approving" this arrangement of intimating that many of the other arrangements out there might not be legitimate under the anti-kickback provisions, specifically stating:
There is a substantial risk that improperly structured payments for on-call coverage could be used to disguise unlawful remuneration. Covert kickbacks might take the form of payments that exceed fair market value for services rendered or payments for on-call coverage not actually provided. Moreover, depending on the circumstances, problematic compensation structures that might disguise kickback payments could include, by way of example:
(i) “lost opportunity” or similarly designed payments that do not reflect bona fide lost income;
(ii) payment structures that compensate physicians when no identifiable services are provided;
(iii) aggregate on-call payments that are disproportionately high compared to the physician’s regular medical practice income; or
(iv) payment structures that compensate the on-call physician for professional services for which he or she receives separate reimbursement from insurers or patients, resulting in the physician essentially being paid twice for the same service.

This is just an advisory opinion specific to this hospital, but it's released publically as a guide to other facilities in similar circumstances, and it seems pretty clear that the OIG is trying to send a message that payment to on-call docs must be reasonable and narrowly crafted to avoid running afoul of Stark.  I rather doubt that we'll suddenly see a lot of enforcement actions on the part of the OIG, this not really being one of their major priorities.   If nothing else it provides a fairly strong argument for the hospitals as they engage in their kabuki with the specialists that, if they are going to pay their on call docs, lavish compensation is not going to fly.


  1. Pardon my ignorance. What's the big deal about paying docs to be on call? We pay firemen even when there are no fires to put out. I fix computers, and if a client wants me to stay in town just in case I'm needed (instead of going off skiing), I'm going to charge a fee for that. I don't see why doctors should be expected to make themselves available at a moment's notice for free.

    Is there some sort of bizarre historical reason why this situation got codified into law?

  2. Joe,

    First of all, the laws came about due to bad behavior of doctors in the distant past, where they would self-refer or do unnecessary procedures or where hospitals would give kickbacks for in-house business, giving docs an incentive to perform unnecessary procedures to milk the system. All ancient history, mostly, but the principle now is that docs and facilities have to maintain an arm's length relationship financially.

    As for paying docs, bear in mind that normally the docs are not hospital employees but are independent contractors, and our pay comes from patients, even in the hospital. We're less like firefighters and more like plumbers -- and nobody pays the plumber to be on call for a backed up toilet. But the plumber does expect to be paid for fixing your toilet. Docs would like to be paid, too, but Federal law (EMTALA) requires that we provide on-call emergency services regardless of payment status. My opinion is that the government should have guaranteed payment for EMTALA-mandated services, but they did not. So now the docs are looking to the hospitals as the 'deep pockets' which is understandable but still not exactly fair.

  3. Interesting. I remember pulling the IRS filing for the hospital I worked at in the past and one of the surgeons who served on the board of directors was paid $20k/yr or something for being a director.

    When I showed another surgeon that he told me that was a violoation of Stark and that he was going to... well, go ask if he could be on the board in exchange for keeping quiet ;)

  4. Was just pounding my head about this last Friday, when calls to the 3 closest ED's revealed none had an ENT on-call to evaluate an oral abscess. Finally found one an hour away who agreed to see the pt. (Unfortunately, at the end of everything, the pt got to the distant ED and somehow was NOT seen by said ENT.)

    I have seen at other institutions non-monetary trades for on-call services such as prime OR time. I felt that it was a thoughtful sidestep. The current system does make it a tough pill to swallow, with no guarantee of reimbursement and yet all the risks of litigation.

  5. The Mommy Doc6/05/2009 1:15 AM

    My husband works as a community pulmonologist but takes ICU call at our local hospital. The week he spends in the ICU (so daytime call), he gets paid b/c otherwise he actually loses money by not seeing his pulmonology patients in his office (but continues to have to pay overhead for the office). He and his partners are trying to force the hospital to hire outside ICU help and not rely on the community pulmonologists. They would like to see intensivists working in shift-model instead of the community guys working 36hrs straight (not healthy nor safe for patients for any decisions made after hour 20). Can't comment regarding the surgeons, but what the hosptial is asking these intensivists to do is just obscene.

  6. Your reply to Joe "...the laws came about due to bad behavior of doctors in the distant past, where they would self-refer or do unnecessary procedures or where hospitals would give kickbacks..." may be true in your area. In this month's New Yorker the author,an MD, says those self-referrals and kickbacks are a common cause of high medical costs.

    The Cost Conundrum by Atul Gawande