There are three remuneration options for sessional VMOs to choose from, but each comes with its own advantages and disadvantages.
All VMOs would be aware of the difference between a Sessional contract and a Fee-for-Service contract. Sessional VMOs charge for public patient treatment at an hourly rate, whereas Fee-for-Service VMOs charge a prescribed fee per procedure or consultation (currently 107.7% of the MBS). What many VMOs are not aware of is that under the VMO Sessional Determination there are three different options for remuneration. This article will explain each option, as well as some of the advantages and potential pitfalls of each.
It’s important to note that there is no overall financial advantage of one option over the other as all three options will provide the same remuneration in the long run. For Options 2 and 3, a reconciliation must take place at the end of a specified period, being 12 months or less. Any over payments or under payments must be addressed at this time. All three options require the VMO to keep the same accurate and complete records of the time spent providing services to patients and the hospital.
Budgeted actual hours remuneration
Option 1 is used by the majority of our VMO members. It is the typical model used in a principal and contractor relationship for professional services, with the additional requirement to estimate the number of ordinary rostered hours that will be completed in specified period, being 12 months or less. The VMO will record the number of hours spent each month providing services to public patients, as well as time spent teaching, training, participating in committees, and attending meetings at the request of the LHD. The VMO will submit a claim through VMoney and receive payment shortly after.
The key risk with this option is failure to address any underestimation of budgeted hours. The VMO should keep an eye on the number of budgeted hours left for the specified period and request any necessary increase as early as possible to avoid having to seek any retrospective adjustments. Note that on-call allowances and call-back payments are not included in the estimated budgeted hours.
If the VMoney checkers have any concerns with the claims, these concerns should be raised with the VMO prior to processing the claim. Please be in contact with AMA (NSW) if you have chosen this option and are facing difficulties with rejected claims, e.g. incomplete claim, hours worked in excess of budgeted hours, non-payment for call-back travel time, etc.
Specified procedures remuneration
Option 2 is designed to accommodate VMOs who prefer to work under a fee-for-service type model. An assessment is made over the specified time period of:
VMOs are then remunerated each month for the number of procedures performed in that month. Time spent completing non-clinical work and call backs, as well as payment for on-call allowances, are to be estimated separately and paid in equal monthly instalments. A reconciliation is conducted at the end of the specific period and adjustments are made as necessary.
Agreed hours remuneration
Option 3 builds on the budgeted hours estimated in Option 1. The budgeted hours are divided into 12 equal instalments, providing a smooth monthly income stream for the VMO. In a similar fashion to Option 2, time spent completing non-clinical work and call backs, as well as on-call allowances, are estimated separately and paid in equal monthly instalments. A similar reconciliation is conducted at the end of the specified period.
Advantages and risks
Both Option 2 and Option 3 have the advantage of providing a smooth monthly income stream for the VMO. The three key risks to watch out for are:
Failure to accommodate for (a) and (b) can come back to haunt the VMO at reconciliation time, as any overpayment must be returned to the LHD. The administrative burden in challenging an alleged overpayment can be onerous. Without accurate and complete records it is difficult for a VMO to defend any overpayment claim.
Risk (a) provides further cause for concern for a VMO with respect to what is colloquially known as ‘double dipping’. Federal and State healthcare agreements do not permit a VMO to receive payment from the NSW Government (i.e. the LHD) and the Commonwealth Government (i.e. Medicare) for the same professional service. Consequences for the VMO may include having to return the Medicare payment. Please call AMA (NSW) if you have concerns regarding this risk.
While the majority of VMOs operate under Option 1, it is important to be aware of the advantages and disadvantages of the different models. Regardless of which option you choose, be sure to maintain meticulous records and keep an eye on your estimated hours and procedures as the year progresses. A copy of the Sessional Determination is available at here.
Should you have any further questions please contact Andrew Campbell at 02 9902 8125 or email@example.com.
Picture this scenario: You’re a consultant providing paid services in a public hospital and you sustain a workplace injury. Perhaps you slip and injure your ankle on a wet floor or damage your hand during a procedure. Would it be reasonable to believe that expenses associated with the injury are covered by a workers’ compensation insurance scheme?
If you’re a VMO you may be surprised to learn that the answer is likely ‘No’.
VMO engagements have a number of characteristics that are similar to an employment model. However, since VMOs are deemed to be independent contractors under the Health Services Act, they aren’t automatically covered by workers’ compensation insurance. This is in contrast to Staff Specialists who are provided with coverage as employees of NSW Health, and have access to compensation for medical expenses, as well as paid leave provisions while recovering from injury. Should a VMO be unable to immediately return to work following an injury then the VMO will be unpaid for time away from the hospital.
As a VMO, it may be wise to consider personal accident and illness insurance to ensure that you are financially secure should any accident or illness prevent you from working. Insurance can provide cover for medical costs associated with the injury as well as income protection for the recovery period.
In addition, many VMOs may not realise that they wouldn’t be covered by the Local Health District’s public liability insurance policy. It is a requirement of many LHDs that public liability insurance is obtained by the VMO prior to accepting the engagement. Public liability insurance is distinct from the professional indemnity insurance you hold with an MDO. It’s designed to provide cover in situations where you are found to be liable for the personal injury of another person, or liable for damage to property.
AMA (NSW)’s commercial partner, Specialist Wealth Group, can provide information regarding the types of insurance available to cover accidents and injuries in the workplace. Please contact Robyn Bulless in Membership Services on 02 9439 8822 to arrange a no-obligation telephone consultation with Specialist Wealth Group to discuss your insurance needs.
VMOs in NSW are deemed to be independent contractors by law, which many doctors mistakenly believe denies them access to superannuation. This is not always correct. While Fee-for-Service VMOs are not entitled to superannuation*, Sessional VMOs are entitled to superannuation if the following criteria are met:
Sessional VMOs engaged using a sole-director practice company are not entitled to superannuation**. VMOs using practice companies would do well to seek independent professional advice regarding their engagement structure, as any perceived taxation advantages of the company structure should be weighed up against the loss of the 9.5% p.a. superannuation benefit. AMA (NSW) members may contact our commercial partners Cutcher & Neale and Specialist Wealth Group for a no-cost consultation regarding the financial advantages of different VMO engagement structures at 1800 988 522.
*Fee-for-Service VMOs cannot claim superannuation because the relevant ATO ruling applies only to individuals who, amongst other factors, are not paid to achieve a ‘result’.
**VMOs engaging in a manner other than as individuals or sole traders cannot claim superannuation because the legislation requires the recipient to be a natural person.
AMA (NSW) has noted concerns from a number of VMOs regarding the rejection of lines in their VMoney claim without adequate explanation. As the concerns have been raised across a number of Local Health Districts, we’ve engaged with the Ministry of Health to consult regarding what we believe should be best practices for the checkers when processing a VMoney claim.
AMA (NSW) will assist the Ministry in creating an education and training package to better outline the information required by the checkers. A review of the existing VMO Claims Auditing Information
Bulletin will commence shortly, and we welcome input from all members following any issues that you’re facing with the current process.
Please contact Andrew Campbell at 02 9902 8125 or firstname.lastname@example.org if you wish to contribute to the consultation.
Not all Fee-for-Service VMOs may be aware, but under the Determination there are additional loadings available beyond the 10% loading for after-hours call backs.
Where the medical service is provided in a hospital which has no Resident Medical Officer, Registrar or Career Medical Officer available as medical practitioner of first contact on a 24 hour a day, seven days a week basis, a fee-for-service VMO should be paid a 10% loading on top of the ordinary fee-for-service payment (currently 107.69% of the scheduled MBS rebate). This is regardless of the time of day and whether the service is pre-booked.
If a VMO ordinarily resides within a 50-kilometre radius of the regional hospital where an emergency after-hours service is provided, the VMO is entitled to a 20% loading on top of the ordinary fee-for-service payment. The loading drops to 10% if the VMO moves outside the 50km radius.
Should you have concerns that you’re not being remunerated correctly and are unable to resolve the matter with hospital administration, please contact Andrew Campbell at 02 9902 8125 or email@example.com to discuss this further.
Radiologists may be getting paid much less for performing MRIs in CTP cases.
Under the current scheme (which is for people injured in a motor vehicle accident from 1 December 2017), the Motor Accidents Injuries Act 2017 indicates insurers are required to pay the AMA Fees list’s maximum fee for MRIs in CTP cases.
The AMA rate for CTP MRIs is $1635. Although it is referred to as a ‘maximum amount’, Section 3.30 of the Injuries Act indicates that this is a set amount, not a cap.
However, some radiologists have flagged that they are only receiving $700, which is the discounted AMA Fees list rate for MRIs in Workers Compensation cases – not CTP cases.
SIRA states that it is common for insurers and service providers to negotiate fees where appropriate, and some insurers and service providers agree to use fees other than the AMA fees, which is allowable.
However, if you have not come to such an agreement with an insurer and you are receiving below the AMA Fees list rate for CTP MRIs, you are encouraged to raise the issue within the complaints process of the relevant insurer. SIRA will review the complaint if a resolution is not struck between the service provider and the insurer.
AMA (NSW) is currently seeking clarification on this issue with SIRA.
Note: The Motor Accident Compensation Act 1999 continues to apply for people injured in a motor vehicle accident up to and including 30 November 2017. Under this scheme, there is no limit set to the fees that are charged.
AMA (NSW) received complaints from a number of radiologists that insurers are increasingly using a broker to arrange bulk patient deals.
The broker offers radiologists a bulk number of referrals in exchange for a discounted fee for radiology investigations.
Some doctors expressed concern that this practice interferes with the treating doctor’s ability to make a referral to the radiologist whom they deem best suited to meet the patient’s needs. While this practice may benefit insurers’ profit margins, it is not in the best interests of patients.
AMA (NSW) is seeking further clarification on this issue.
If you have any further information regarding this practice, or would like to raise any other issue with AMA (NSW), please contact our offices on (02) 9939 8822 or firstname.lastname@example.org.
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Contact email@example.com if you want to comment on these issues.