Short answer: Provider compensation is usually a practice's largest expense and its most sensitive conversation. Salary offers stability, productivity plans reward volume, and hybrid models try to balance both. The right plan aligns pay with the practice's goals and stays affordable at different volumes, which means modeling it before you roll it out.
| Model | How it works | Trade-off |
|---|---|---|
| Salary | Fixed pay regardless of volume | Predictable, but weak link to productivity |
| Productivity | Pay tied to output, often work RVUs or collections | Rewards volume, but can create uneven workloads |
| Hybrid | Base salary plus productivity or quality incentives | Balances stability and incentive, but more complex to administer |
A relative value unit that measures the work involved in a service. Many productivity plans pay a rate per work RVU produced.
Collections tie pay to cash received; production metrics like work RVUs remove payer mix and billing issues from the provider's pay. Many practices use one or a blend.
Yes. Healthcare compensation can be subject to federal and state rules, including physician self-referral and anti-kickback laws. Always involve qualified healthcare counsel.
This article is general information, not legal or tax advice. Provider compensation arrangements should be reviewed by qualified healthcare counsel.
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