Provided by: Jennifer Kirschenbaum, Esq.
July 16, 2024
Question:
Hi Jennifer,
Thank you for shining a light on RVU models. The issue I’m having is a claimed shortfall. The institution I work for is actually requesting a repayment. I should have paid more attention on the way in.
Dr. S
Answer:
Yes, thank you for highlighting. Often times a RVU model with a threshold requirement also has a component of repayment on shortfall. Usually, there is a margin of about 5% from the threshold, and anything below that point would require repayment. A reconciliation process will be laid out in the contract. Often times an institution pairs an RVU model with a guarantee. Guarantees may be for 12, 18 or 24 months, typically.
What I like about an RVU model is you are guaranteed payment irrespective of collections. Meaning, payment is not contingent upon the institution doing its job and recovering money for your billing. A collection based compensation contract is completely dependent on the rate of collection. So, there are positives to an RVU model and not putting yourself in the business of being a billing company. Also, remember, there is no legal requirement that you accept a repayment structure; you could negotiate no repayment structure.
Thank you for shining a light on RVU models. The issue I’m having is a claimed shortfall. The institution I work for is actually requesting a repayment. I should have paid more attention on the way in.
Dr. S
Answer:
Yes, thank you for highlighting. Often times a RVU model with a threshold requirement also has a component of repayment on shortfall. Usually, there is a margin of about 5% from the threshold, and anything below that point would require repayment. A reconciliation process will be laid out in the contract. Often times an institution pairs an RVU model with a guarantee. Guarantees may be for 12, 18 or 24 months, typically.
What I like about an RVU model is you are guaranteed payment irrespective of collections. Meaning, payment is not contingent upon the institution doing its job and recovering money for your billing. A collection based compensation contract is completely dependent on the rate of collection. So, there are positives to an RVU model and not putting yourself in the business of being a billing company. Also, remember, there is no legal requirement that you accept a repayment structure; you could negotiate no repayment structure.
