Article, Emergency Medicine

Compensation models in emergency medicine: An ethical perspective

a b s t r a c t

There is considerable diversity in compensation models in the specialty of Emergency Medicine (EM). We review different compensation models and examine moral consequences possibly associated with the use of various models. The article will consider how different models may promote or undermine health care’s quadruple aim of providing quality care, improving population health, reducing health care costs, and improving the work-life balance of health care professionals. It will also assess how different models may promote or undermine the basic bioethical principles of beneficence, non-maleficence, respect for autonomy, and justice.

(C) 2019

Introduction

Compensation models in Emergency Medicine (EM) are varied and complex [1]. They have often been developed over a long per- iod of time to meet the needs of healthcare institutions, contract- ing or employed physicians, communities, and the marketplace. Some are also designed, at least in part, to serve the interests of for-profit corporations and their shareholders. Patient needs are often not explicitly considered in physician compensation agree- ments, which can lead to perverse incentives that are not in patients’ best interests. Economic models based on health insur- ance contracts, fixed payments (such as to Independent Practice Associations on a ”per patient per month” basis), or bundling pos- sibly could lead to the withholding of necessary diagnostic studies and treatments or attempts to shift services to other locations or providers at later times. Compensation models designed to control utilization may also discourage both referrals by other providers to the emergency department (ED) and admission decisions in ways that compromise patient care. In contrast, strict fee-for-service compensation models, including models based on relative value

* Corresponding author.

E-mail addresses: [email protected] (D.R. Martin), jmoskop@ wakehealth.edu (J.C. Moskop), [email protected] (K. Bookman), [email protected] (J.B. Basford), [email protected] (J.M. Geiderman).

units (RVUs), may encourage inappropriate testing, procedures, or admissions.

Following a brief description of some compensation models used in EM, this article reviews basic goals of health care systems, individual physicians’ goals and desires, and fundamental bioethi- cal principles, noting how these goals and principles bear on physi- cian compensation arrangements. The article does not endorse a single model of compensation for emergency physicians (EPs). Rather, it examines ethical issues surrounding physician compen- sation that may affect patients, physicians, the medical profession, hospital owners, and the health care system.

Current compensation models

EP compensation is commonly based on both clinical and non- clinical factors. Both types of factors can reflect valuable contribu- tions to the health care enterprise that deserve compensation. Clin- ical factors include efficiency (e.g., number of patients seen or RVUs per hour), patient outcomes (e.g., pay-for-performance mea- sures), and patient satisfaction [e.g., Press-Ganey or National Research Corporation (NRC) scores]. Other clinical metrics are rates of patients Left without being seen , elopements, unex- pected 72-hour returns, and appropriate or inappropriate utiliza- tion of testing (e.g., laboratory studies, CT scans, and ECGs) and procedures. Non-clinical factors include seniority in the group,

https://doi.org/10.1016/j.ajem.2019.158372

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hospital and departmental administrative roles, group or depart- mental citizenship, service to the public or the profession, scholarly achievement, biomedical research, and resident and medical stu- dent teaching, supervision, and evaluation.

Compensation for various types of employment has evolved, from models in which most if not all employee pay was based on an hourly wage rate and the number of hours worked, to more recent emphasis on compensation based on productivity, that is, the quan- tity and quality of one’s work product. In addition to productivity, incentives and bonuses are key components in compensation. Pro- ductivity is an economic measure of output per unit of input. Inputs include labor (hours worked) and contributed capital, and output is typically measured in revenues and other measures of production such as publishing or teaching [2]. An incentive is something of value that motivates a party to do more of what the employer or contractor desires [3]. A major limitation to using productivity, as defined above, as a measure in the ED is the fact that incentives should be rewards that are directly related to increased output from additional effort expended, which is not always the case in the ED. [4] In EM it is very difficult to use RVUs or patients per hour since the quantity, complexity, and treatment needs of patients can be very different depending on the day of the week, the particular shift, the insurance coverage, and the psychosocial needs of patients, with many of these differences due to random variation. Morally, the duty of a physician to any patient should not vary with these factors.

A bonus is any financial compensation or reward over and

above the normal expectations of the recipient. A bonus can be given to a company’s employees and executives, prospective employees, or shareholders [5]. In EM this is often compensation above base pay because of an overall positive financial balance at the end of a particular time period. Although base pay is deter- mined by an underlying structure of hourly rates, salary or a com- bination, these rates are usually based on group revenues and possible hospital or system subsidies for treating uninsured or under-insured populations. Some EP groups use a combination of salary or hourly wages and incentives or bonuses based on specific metrics such as those listed above.

Many physician groups in the US compensate providers based solely on the fees they generate and are collected. Compensation arrangements for physicians in multiple medical specialties are increasingly using RVUs and EM compensation models often use RVUs per hour as their measure of productivity. RVUs originated from efforts to value and reimburse physician services based on a formula that includes the work input by physicians, an index of specialty practice costs, and the Opportunity costs of specialized training [6]. More recent models recognize work RVUs for physi- cian time and effort, practice RVUs to cover practice expenses, and malpractice RVUs to cover the costs of professional liability insurance coverage [7,8]. RVU-based payment schedules for proce- dural services are higher than for office visits and may result in the overuse of certain procedures. Although RVUs, in combination with patients seen per hour, are commonly chosen for productivity- based compensation models, physicians in some specialties, such as anesthesia, surgery, and geriatrics, have had mixed feelings about embracing RVUs as a major measure of productivity [9- 11]. Most notably, many anesthesiology groups have realized the lack of a direct relationship between additional effort required in complex cases and compensation based on measured output. These groups increasingly use shifts and hours worked as a mea- sure of ”work done.” [9]

Compensation models and proposed aims of health care

In 2008, Don Berwick and colleagues at the Institute for Health- care Improvement (IHI) recommended that the US healthcare

system adopt the ”Triple Aim” of improving individual patients’ experience of care, improving the health of populations, and reduc- ing the per capita cost of health care [12]. This Triple Aim was widely embraced as a model for health care reform at national and institutional levels. Others later proposed the addition of a fourth aim, improving the work-life balance of healthcare provi- ders, resulting in a ”Quadruple Aim.” [13,14] Although the IHI has chosen to retain its focus on achieving the patient-centered outcomes of the Triple Aim, many Healthcare organizations have looked to the fourth aim of enhancing the ”work-life balance” that many younger healthcare professionals appear to value more than a higher income as a way to attract those who want this model [15].

All four of the goals are clearly morally worthy, but they are also often in competition with one another, in the sense that concen- trating on one or several of the goals might result in paying less attention to others. In fact, individual professionals have to make choices among various personal goals such as the desire for a ful- filling work experience and the desire for a higher income. As out- lined below, consider how different EP compensation criteria might emphasize each of the goals in different ways.

Improving individual patients’ experience of care

To promote this goal, compensation models could reward EPs for providing timely, respectful, high quality care by using key components of physician performance such as patient throughput times, patient satisfaction scores, compliance with treatment pro- tocols, best practices, and ”pay-for-performance” or other quality metrics, as well as considering ”overall” patient care. The chal- lenge, however, lies in finding effective measures for quality care. Compliance with Treatment protocols, best practices, patient out- come data, and throughput time can be extracted from electronic medical records. But the overall quality of an EP’s patient care can only be judged by a 3rd party, such as a Chief or Chair over time. Peer review of cases, patient complaints, and other 3rd party feedback (for instance, from medical and nursing staff) can inform this determination. Though direct observation has been shown to be a useful way of measuring physician performance [16], imple- mentation could be challenging. Implementation of effective team- work has also been shown to improve the quality and safety of healthcare delivery and can be measured using patient and team member surveys [17].

In order to emphasize attention to optimizing the care of indi- vidual patients, a primary focus on this goal would presumably not base compensation solely on the number of RVUs per hour, but rather use additional measures like those outlined above.

Improving the health of populations

Emergency departments contribute to population health by serving as a safety net for the provision of health care to those who lack other ready access to care. To promote this goal, compen- sation models could reward EPs for providing care that is not directly related to a patient’s reason for the visit. In some EDs, pre- ventive care such as vaccination and disease detection such as HIV testing is being performed. To maximize the provision of health- care for all who present to the ED, compensation measures might include but not be limited to: outcome data such as the number of vaccinations provided; the number of new diagnoses of HIV; maximal use of counseling; efficient and successful referrals to pri- mary care providers and specialists; and decreasED return visits to an ED. Such a model should incentivize the provision of essential health care services regardless of the amount of patient revenue that is actually produced, or the costs incurred by these activities. Payment for those services, however, would likely have to come

from public health insurance programs through models such as PQRS payments that reinforce good practice.

By identifying Disease states amenable to proven, evidenced- based interventions that reduce morbidity and mortality, and then applying those tools, EPs may be able to reduce the financial and health burden for a given disease state on the healthcare system as a whole, while improving the health of a given population. Though there is a paucity of research on the subject of population health outcomes related to emergency medicine, adherence to nationally and institutionally recognized treatment protocols and decreasing variation of practice and decision making among EPs may meet this goal of improving the health of the local population. Metrics such as these can often be extracted from data tracked in electronic medical records. As such, incentive pay could be tied to adherence to treatment guidelines designed to improve overall population health.

Reducing the per capita cost of healthcare

Health care systems can reduce the per capita cost of the care they provide in a variety of ways, including avoiding wasteful or low-value services. EDs have been widely criticized as a high- cost setting for care that can be provided much more efficiently and at lower cost elsewhere, but others have challenged that crit- icism, often on the grounds that other sources of care are inacces- sible to many patients in need and represent environments where risk to the patient is increased, as, for example, when high-risk chest pain patients initially visit urgent care clinics rather than an ED. EP compensation measures to promote this goal could include measures of appropriateness of tests and procedures ordered and specialty referrals made, with incentives for withhold- ing wasteful or only marginally beneficial care. A more controver- sial measure might reward physicians for referral of patients out of the ED for non-urgent, self-limited conditions that can be treated more efficiently and economically in another care venue. In con- trast to compensation schemes that focus on management of pop- ulation health, primary attention to the goal of reducing costs would presumably not base compensation on provision of compre- hensive services in the ED, as those measures could increase the cost of care.

Improving the work life of health care professionals

Recent recognition of this fourth goal is, in large measure, a response to evidence that physicians, nurses, and other health care professionals frequently suffer from high stress, low morale, poor physical and mental health, substance abuse, and job dissatisfac- tion. The ED, with its endemic crowding, high acuity medical con- ditions, and heightened emotions, is often a high-stress environment for clinicians. Compensation models could address this goal by rewarding physicians who are recognized by col- leagues and co-workers as resilient, supportive, and empathetic to both patients and their fellow professionals. Patient experience metrics or staff feedback mechanisms could be used to quantify these traits. Models that focus on this goal would not impose RVU or patient volume targets that require physicians to work under constant stress or to compromise the quality of the care they provide in order to meet their income goals. A goal subsumed under this aim would be to maximize long-term career satisfaction and reduce ”burnout.”

As these general reflections suggest, health care systems may choose different physician compensation models, for different rea- sons. The choices that systems make can reflect the relative prior- ity they place on satisfying each of the four different elements of the Quadruple Aim. In the pluralistic marketplace currently

present in the United States, physicians can often find a position that emphasizes the goal or goals that are most important to them.

Compensation models and the principle-based approach to bioethics

From its first full statement in 1979, Tom Beauchamp and James Childress’ principle-based approach to bioethics has been widely used as a framework for addressing ethical issues in health care. Beauchamp and Childress identify four general bioethical princi- ples [18]. They claim that these principles are fundamental, essen- tial, and universal, but they acknowledge that none of the principles is absolute. Beauchamp and Childress appeal to these principles to ground more specific moral rules, and they recognize the need for moral analysis to resolve conflicts between principles or rules. Another way to examine the moral implications of differ- ent physician compensation models is to consider whether they are consistent with the four basic principles of this approach, namely, beneficence, non-maleficence, respect for autonomy, and justice [18].

Beneficence

The principle of beneficence asserts a positive duty of physi- cians to act for the benefit and welfare of their patients. At a min- imum in the ED, physicians should arrive at a diagnostic impression and provide or arrange for indicated treatment, includ- ing hospital admission or transfer, if necessary. Withholding any of these services for personal gain or for the gain of a third party con- stitutes a violation of the duty of beneficence.

EPs should take the life situations of their patients into account in caring for them. For example, if a young mother with two depen- dents at home and responsibility for an older parent in her care presents to the ED at 9 pm for evaluation of a suspected chronic ill- ness, such as lupus, she may need a greater work up in the ED than a different person at a different time. EPs should, to a reasonable extent, consider personal factors such as these along with eco- nomic and other factors in determining what is medically neces- sary despite the fact that it may consume their time without compensation.

Compensation arrangements that provide major financial incentives to physicians for withholding or delaying care may set up a conflict of interest; that is, physicians may consciously or unconsciously make choices that enhance their income at the expense of their patients’ welfare. For this reason, physician com- mentators have argued that incentive programs for withholding care are ethically questionable [19].

Non-maleficence

The principle of non-maleficence asserts a negative duty of physicians to refrain from interventions that are likely to cause more harm than benefit for their patients. Among the harms that can befall a patient are physical, psychological, and economic harms. Patients with high deductible health plans and Uninsured patients frequently seek care in the ED. Under productivity-based compensation models, physicians may be financially rewarded for ordering more tests and performing more procedures, but over-testing or overtreatment can cause major physical and eco- nomic harms for all patients, and especially low-income patients. Although examples or studies demonstrating this are lacking in emergency medicine, if compensation arrangements subcon- sciously encourage over-testing and overtreatment, those arrange- ments could induce physicians to violate the duty of non- maleficence. If productivity-based models incentivize EPs to make

Clinical decisions and provide services too quickly, the result may be a greater number of Medical errors causing significant harm to ED patients.

Respect for autonomy

The principle of respect for autonomy directs physicians to respect the autonomous choices of their patients and to assist patients in making and carrying out informed choices. These choices often have significant physical and financial consequences. In order to make informed treatment choices, patients must have knowledge of their options and the likely consequences of those options. Out of respect for patients’ autonomy in making their own decisions, patients might need to be made aware of any sort of financial incentive that may influence a physician’s decisions about their care [20,21]. There are, however, usually more pressing clinical matters in the ED; ED patients may feel vulnerable, and such discussions may strain their relationship with their providers [22]. EPs may also be reluctant to disclose detailed information about compensation to patients, claiming a right to protect the confidentiality of that personal information. Although the com- plete details of a physician’s compensation likely do not need to be disclosed to the patient, disclosing incentives only may be an appropriate middle ground. Disclosure of physician compensation in the Primary care setting has been provided, with good feedback from patients. In one study, the majority of patients in two physi- cian groups noted no change in their trust level for their providers, and many noted an improvement in their trust after disclosure [23].

Patients may ask how much a particular visit, test, or procedure

will cost them. Although this information is not always readily available, physicians should do their best to provide accurate infor- mation. The common answer ”We will treat you no matter what” may be true, but it does not provide the information about the per- sonal financial consequences of different treatment options that patients or surrogates may need to make an informed choice. As the health care industry evolves, price discovery will become sim- pler and more common, but at this moment it remains somewhat opaque.

Physicians have a modern-day duty to be truthful. The second of the Principles of Medical Ethics of the American Medical Associa- tion (AMA) asserts that, ”A physician shall.. .be honest in all pro- fessional interactions.. .,” [20] and the fourth principle of the American College of Emergency Physicians (ACEP) Principles of Ethics for EPs makes a similar assertion that ”EPs shall communi- cate truthfully with patients.. .” [24] Interestingly, according to Beauchamp and Childress, this duty was not generally recognized until about 1980, and it is not mentioned in the Hippocratic Oath or the Declaration of Geneva [18]. The economic motives of a physician are not always apparent to patients, nor are they appro- priate to discuss during an emergency encounter, but, to the extent possible, they should be revealed [20]. In situations where physi- cians are independent contractors, this is often disclosed (some- times by regulation) by registration staff. In the end, physicians acting as moral agents must be honest with themselves and their patients as to why they are ordering a particular test, doing a pro- cedure, or making an admission decision. Ideally, care should be provided in the same manner regardless of the patient’s ability to pay and regardless of physician financial incentives.

Justice

Beauchamp and Childress recognize not just one, but rather multiple principles of justice to guide distribution of the benefits and burdens of health care among the members of a given popula- tion [18]. As both the benefits and the costs of health care have

expanded virtually exponentially over the past half century, ques- tions of distributive justice have become increasingly important for societies, institutions, and individuals. The second of ACEP’s foun- dational Principles of Ethics for Emergency Physicians directs emergency physicians to ”respond promptly and expertly, without prejudice or partiality, to the need for Emergency medical care.”

[24] This principle takes a significant stand on an issue of distribu- tive justice in its implicit recognition of a patient right to emer- gency care. The US federal government mandated access to Patient evaluation and treatment for emergent medical conditions, regardless of ability to pay, in its Emergency medical treatment and Labor Act (EMTALA) of 1986 [25]. Because this is an unfunded mandate, however, the burden of financing emergency care falls on health insurers, institutions, and patients themselves. Providing universal access to emergency care would potentially be compati- ble with different models of EP compensation, but compensation arrangements may have an indirect bearing on the ability of insur- ers and hospitals to provide timely and equitable access to emer- gency care. For example, if EP groups demand compensation levels that hospitals in low income or rural areas cannot afford, those hospitals may be forced to reduce emergency facilities in ways that greatly restrict patient access, or to close their EDs alto- gether [26]. Alternatively, especially in situations where groups are subsidized, it could lead to hospitals searching for the lowest cost providers, regardless of quality. EPs should seek to balance their interests in reasonable compensation for their services and support for equitable access to emergency care for patients in need.

Guidance from professional organizations/societies

Professional organizations in EM have taken different positions on the ethical appropriateness of various compensation models in the specialty. Though it does not endorse one compensation model over another, ACEP has provided general guidance on compensa- tion arrangements for EPs in policy statements and information papers [1,27]. The American Academy of Emergency Medicine (AAEM) supports ”fair and equitable practice environments neces- sary to allow the specialist in EM to deliver the highest quality of patient care.” [28] AAEM also mentions incentives and emphasizes that ”this effort should be tempered by quality and satisfaction standards.” [29] Although compensation can be structured in a number of ways, there is also widespread acceptance that perfor- mance incentives accompanied by timely feedback resulting in fair compensation is the overriding goal [1,30]. The AMA also addresses issues of physician compensation in its Code of Medical Ethics [20]. This document provides specific guidance for avoiding conflicts of interest in stressing the importance of the ”core commitment to fidelity” in the practice of medicine and eschewing financial inter- ests as a ”subordinate consideration” in the care of patients [20]. ACEP offers similar guidance for EPs through its Code of Ethics for Emergency Physicians [24].

Keeping the recommendations of these professional medical

organizations in mind, regardless of the physician employment model, there are a variety of potential approaches to distributing the revenue generated in each practice. Compensation models should be structured to align optimally with the needs of patients, the community, the home institution, and the providers, as much as possible [27].

In addition to earning clinical revenue, academic medical pro- grams must also support the mission areas of research and teach- ing. academic physicians have a duty to provide education to fellows, residents, students, other learners, and their patients, not only as part of their Oath, but also as a duty to society and for con- tractual and fiduciary reasons. Shortchanging these goals in order to produce more personal revenue could constitute an ethical

breech. academic practices face an ever-increasing pressure to include incentives and compensation above base pay. Recent data presented at the Academy of Administrators in Academic Emer- gency Medicine (AAAEM) national meeting outlined several differ- ent compensation models in academic practices that included variable combinations of base pay, extra hours pay, stipends for non-clinical work, and bonus or incentive compensation. Academic medical centers have increased their use of ”performance-based- incentive compensation models” as well and have tied incentives to many clinical and non-clinical mission areas [31,32]. Interest- ingly, models incorporating more of these four elements were associated with higher average total salaries [Personal Communi- cation; Greg Archual, Association of Academic Chairs in Emergency Medicine/Academy of Administrators in Academic Emergency Medicine (AACEM/AAAEM), Annual Retreat, San Diego, CA, pre- sented March 2018]. Certainly, a fair compensation model is important for academic clinicians and serves to attract, support and develop future academicians.

Conclusion and future directions

There are many employment/contractual models in the spe- cialty of EM, with incentives and bonuses often tied to a variety of EP performance targets. Patient-centered ethical principles and compensation arrangements of EPs that maximize physician com- pensation and corporate revenues may sometimes conflict. An awareness of this potential for conflict can help health care sys- tems and employers make ethically sound decisions about struc- turing their reimbursement schedule and can guide clinicians in choosing an employer whose compensation structure is in line with the clinician’s own ethical beliefs and values.

This article has outlined a variety of factors used in physician compensation models and has examined the moral implications of different compensation models. These models, especially pro- ductivity incentives, have significant moral implications. Further study is needed in the area of compensation based on ”pay-for-p erformance” metrics. It is not known how these practices will affect patient outcomes or compensation and Practice models for EPs [17,33,34], though patient-centric arguments for their use have been made [35]. More research and ethical analysis is needed to evaluate the consequences of compensation models for achieving basic health care goals and respecting fundamental principles of bioethics. Also needing longitudinal study is which model will result in more career satisfaction and less burnout. These addi- tional efforts would help determine and support compensation practices that address the quadruple aim of health care and respect basic principles of bioethics.

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