Academic rheumatologists generate $12.14 in revenue for every $1 they receive
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Academic rheumatologists generate $12.14 in downstream revenue for their health system for every $1 they receive for office visits, according to data published in Arthritis Care & Research.
The data come from a group of academic rheumatologists at the Loma Linda University School of Medicine in California. Their findings follow a previous study published in 2005 that found that clinical rheumatologists generate more than $10 for every $1 they receive for office visits. Adjusted for inflation, that equals approximately $13 for every $1 in 2021.
“Our study replicates larger level findings from Wickersham et al. in 2005, showing that rheumatologists in a large hospital setting contribute to the overall revenue generated by that system,” Christina Downey, MD, CCD, RhMSUS, DipABLM, one of the co-authors and rheumatologist at the Loma Linda University School of Medicine, told Healio. “These findings show that even in a different metropolitan area and 15 years later, rheumatology practices are an asset to university health care systems.
“This study adds to the compendium of tools division directors of academic rheumatology practices have available for discussing their vital role in their health systems,” she added.
To examine the financial gains an institution receives from clinical academic rheumatology practices, and address other aspects of productivity, Downey and colleagues conducted a retrospective analysis of the ordering practices of five full-time clinician-educator rheumatologists at the Loma Linda University Health System, from August 2017 to February 2019. Individual workload was defined as averaged full-time equivalents based on time spent on clinical and academic duties. In addition, the researchers reviewed academic productivity, based on scholarly work, publications and professorial status.
Downey and colleagues then collected and reviewed revenue generating activities that benefited the rheumatology division directly as well as downstream revenue. The researchers extrapolated revenue based on volumes of referrals, publicly available drug costs and the estimated Medicare reimbursement values — via average sales price — of representative drugs.
According to the researchers, the total revenue, per physician, benefiting the rheumatology division directly was $597,203, with evaluation and management codes accounting for $174,456. Meanwhile, downstream revenue, per physician, totaled $2,119,437. The largest contributor was from referrals to the hospital-based infusion center, totaling $1,287,496. Rheumatologists generated $12.14 of downstream revenue per dollar of evaluation and management services.
“We argue that downstream revenue generated in addition to direct billings should be strongly considered in providing value to the work rheumatologists provide to an entire academic health system,” Downey and colleagues wrote. “We also suggest developing a compensation package that considers teaching and other scholarly activities since time demand for these activities may not correlate to the amount of corresponding compensation obtained.”
They added: “We encourage new consideration for the downstream revenue generated by infusion products, laboratory testing, procedures, and radiographic imaging in overall salary earned by academic rheumatologists.”
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