Becker's Hospital Review

9 CFO / FINANCE The cost of physician turnover By Laura Dyrda P hysician turnover rates are increasing as more clinicians experience burnout and decide to retire early, leave the field or refresh their practice setting. e Association for Advancing Physician and Provider Recruitment's report on physician and provider retention and turnover in 2022 showed around 76 percent of physician exits in organizations with the most and least providers were due to retirement. Physicians finding a new role elsewhere was also a top response. If caught unaware, physician turnover can hit the health system's finances hard. Here are seven points: 1. Losing a physician means hospitals won't receive the revenue associated with those cases until the physician is replaced. Physicians also typically have a ramp-up period for to build a patient base. On average, physicians generate $2.4 million for affiliated hospitals each year, according to Merritt Hawkins. e highest revenue generating physicians being interventional cardiologists who generate $3.48 million per year and then orthopedic surgeons who generate $3.29 million per year. 2. Interview expenses could be $30,000 per candidate, with the interview process relevant to recruiting costs being around $250 for human resources per hour plus lost productivity during the interview, according to a report from the New England Journal of Medicine authored by Tony Stajduhar, president of Jackson Physician Search. 3. Revenue lost from the vacancy of a physician depends on the specialty; a family medicine physician that generates $1.5 million revenue for the hospital could mean a loss of $130,000 per month until the vacancy is filled, Mr. Stajduhar noted. 4. On average, it takes 4.3 months to fill an open family medicine role, and five to 10 months to fill a specialist role, NEJM reported. In that time, hospitals could lose $559,000 on the open family medicine spot and much more for medical specialists. 5. Newly hired physicians receive a myriad of financial perks. More than 90 percent of hospitals offer an average of $10,000 to $15,000 for physician relocation as needed, according to the Association for Advancing Physician and Provider Recruitment. Forty-one percent of organizations surveyed offered $75,000 to $99,000 in physician student loan repayment. 6. Ninety-one percent of organizations offered signing bonuses to new physicians, typically $20,000 to $30,000, according to the American Association for Advancing Physician and Provider Recruitment. Physician signing bonuses jumped 21 percent from 2022 to 2023 to $37,473, according to a report from AMN Healthcare. e signing bonus for the most requested specialties was much higher; family medicine physicians had an average signing bonus of $45,918 and a high of $250,000. 7. Hospitals will sometimes pay for medical malpractice insurance for physicians, which varies by state and specialty. Overall, medical malpractice premiums increased 30 percent from 2020 to 2022, according to the American Medical Association. n CMS launching population health-focused payment model for states, hospitals By Jakob Emerson C MS is launching a new population health-focused payment model aimed at addressing chronic dis- ease, behavioral health and overall improvement of care management for states' populations. The agency said in a Sept. 5 news release that it would award as many as eight states up to $12 million each to implement the States Advancing All-Payer Health Equity Approaches and Development Model, which is the next iteration of the CMS Innovation Center's multipayer total cost of care models. States participating in the AHEAD model will be account- able for quality and population health outcomes, along with reducing avoidable spending. Participants will part- ner with providers and leverage existing relationships to recruit hospitals — participating hospitals will receive an annual fixed payment. Payments would be for Medicare and Medicaid, and other insurers could also pay participating hospitals for enrolled populations or specific patient groups. Interested states can apply during two application periods and can participate in one of three groups with staggered start dates and performance years. Specific funding and application information will be released in late fall. States will have 90 calendar days to apply during the first applica- tion period. The second application period is expected to open in the spring with a 60-day application period. Pre-implementation for the first cohort is scheduled for summer 2024. The performance period is scheduled for January 2026 or January 2027, depending on the cohort, and the model will conclude for all participants in Decem- ber 2034. n

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