As a physician recruitment firm, we here at Pacific Companies have established the most frequently asked questions from our permanent providers. While every provider is looking for different opportunities and has varying priorities for themselves, their career, and their familial goals, they tend to ask the same questions. In this blog, we will provide an overview of how RVUs are structured, the types of student loan repayment, and the key topics to evaluate during the decision making process. 

1. How are RVUs structured?

RVUs are the basic component of the Resource-Based Relative Value Scale (RBRVS), which is a methodology used by the Centers for Medicare & Medicaid Services (CMS) and private payers to determine physician payment. Work RVUs (wRVUs) take into account the provider’s work when performing a procedure or service. This includes the technical skills, physical effort, expertise and judgment, stress related to patient risk, and the amount of time required to perform the service or procedure.

Medicare pays physicians for services based on submission of CPT (Current Procedural Terminology) codes through Electronic Medical Records systems (EMRs). CPT codes are used to describe tests, surgeries, evaluations, and any other medical procedure performed by a healthcare provider on a patient. This code set is incredibly vast and can contain thousands of individual codes, depending on the specialty.

Each CPT code has a Relative Value Unit (RVU) assigned to it, (basically a preset allocation of time, which can be a fractional unit) which helps to determine how much physicians are paid. RVUs are not categorized by an actual dollar amount/value for which the physician gets paid.  How much the physician makes is determined by multiplying the RVU by a conversion factor (CF), which is a dollar amount assigned to each RVU. Congress sets the value of the CF each year, so it can vary from one year to the next.

In summary, for every service a physician provides to a patient, they track that by inputting a CPT code into their EMR system. Those CPT codes will have a correlating wRVU amount which is then multiplied by the CF to determine the amount a physician makes for each service.

2. What are the most common types of student loan repayment?

Public Service Loan Forgiveness:

The PSLF program, created in 2007, forgives the remaining balance of qualified federal student loans after the borrower makes 120 qualifying monthly payments. There are several options for determining the monthly payment amount but will be between 10-20% of monthly discretionary income. Additional requirements for this program are to be employed full-time (30 hours per week minimum) by a U.S. federal, state, local, or tribal government or not-for-profit organization such as a 501(c)(3).

Initially, less than 1 percent of the 40,000 applicants were approved. Even in 2021, 98 percent of applications have been rejected for various reasons.

National Health Service Corps:

The National Health Service Corps Loan Repayment Program is available to Primary Care & Behavioral Health professionals. To qualify, you must work in a Health Professional Shortage Area (HPSA) for a minimum of two years. During the initial two-year contract, providers would be given $25,000 each year to pay off student loan debt. Providers may extend loan repayments beyond two years by reapplying each year for an additional $25,000 per year. One of the good things about the NHSC student loan repayment is the full amount every year is paid directly to you, but you are not taxed on this amount.

Employer Paid – Direct Student Loan Repayment:

Many employers, especially those in more rural communities will offer physicians direct student loan repayment, which is considered income and taxed as such. The qualifications for these will vary widely depending on the organization offering the repayment. There are really two standard scenarios to receive these funds. The most common would be for the organization to give an allotted amount of money over a specific time frame ($100K over 5 years). In this scenario, the organization would give the physician $20K at the end of each year completed, for 5 years. The benefit to this is there are no repayment terms if a provider were to leave before the end of 5 years.

Scenario two would be a lump sum, ($100K but is tied to a 5-year contract). In a situation like this, the $100K would essentially be a “loan” and the organization would forgive $20K at the end of each year completed. The physician would be required to sign a promissory note, to repay the full amount of money that has not been forgiven. For example, if the provider leaves after their 3-year anniversary they would be required to pay back the last 2 years of forgiveness, which would be $40K.

3. How do you undergo the decision making process?

In terms of when a provider decides to start looking for a job, whether it be a new graduate ready to start their career or a provider looking to make a change, the decision making process is one of the least discussed topics. Making the decision to join a practice is not something that is taken lightly and, many times, it can prove challenging to navigate what exactly they want and need out of an opportunity. 

There are four quadrants that are essential to evaluate during the decision making stage: professional satisfaction, financial satisfaction, geographical satisfaction, which can fall into a variation of subcategories, and personal satisfaction, which also branches out to several categories. A provider may experience dissatisfaction in any of one these areas, or a combination thereof. Once these quadrants, or “buckets”, are established, it is vital to outline areas with the most prominent need for improvement. This aids in streamlining the top focuses for a new search. In addition, it is invaluable to assess your main focus and ask yourself the question: “Does this solve the problem?” 

Let’s say you’re searching for a new practice opportunity and are only searching in the area you are currently located, but your main problem is that you’re unhappy financially. You may run into the problem that every opportunity in your area doesn’t offer the compensation that you want to make. While it can be uncomfortable to think about and discuss relocating at times, that is where you need to start in order to truly solve the problem. When working with a staffing firm, such as Pacific Companies, it is imperative that you communicate your highest need to the recruiter that you’re working with so they can best help you in solving the issue. 

Transparency and communication are two of the main aspects of going through the decision making process; and not just with your recruiter, but with your significant other or spouse. In doing so, your family will be more equipped to achieve both of the goals in mind. Where one of you may be focused on the financial goals of the family, the other may find that education in the community is of top importance. The ability to communicate with one another and your recruiter is vital to ensuring that the needs of everyone involved are met to the highest ability. 

To take this one step further, get your significant other and recruiter acquainted and involved in conversations about the search. Your recruiter is an invaluable source of information and, more often than not, have visited the areas and healthcare systems that you’re considering. As Courtney Yudin, Director of Recruitment at Pacific Companies, explains, “We [the recruiters] can speak in greater detail about the area and opportunity and be a resource. Nine times out of ten, the physicians are thanking me for making myself available to their better halves to better help them in the process. Whether that be with the position I’m representing or not, it really does help with the professional and personal counseling of ‘what’s the problem,’ ‘how do we achieve it together,’ and doing a true breakdown of the decisions you need to make.” 

Overall, establishing the main area of dissatisfaction and need for improvement is the most important aspect of the decision making process. This cannot be done without communication and transparency both with the important people in your life and your recruiter. Once this is clearly defined, it will be easier for you to identify opportunities that best fit your needs.