Published December 15, 2023

PYA Discusses Financial Assistance Arrangements in National Publication

Angie Caldwell, Consulting Principal and Office Managing Principal, Kelsey Kindel, Consulting Manager, and Allie Jahn, Consulting Staff, recently authored an article published by the American Association of Provider Compensation Professionals (AAPCP). The article, “Helping Hospitals Navigate Financial Assistance Arrangements to Secure Specialty Coverage in an Evolving Healthcare Landscape,” describes a recent trend of physician groups requesting financial assistance arrangements (subsidies) from hospitals for the first time or seeking increases in existing subsidies. The authors share common pitfalls and best practices related to financial assistance arrangements.

Subsidies are often critically important for the continued operation of a physician group to meet the needs of the community and pay fair market value to its physicians and advanced practice providers. “Financial assistance arrangements should be carefully negotiated and align the goals of the Hospital with that of the Group,” said the authors. “…Hospitals should consult with experienced healthcare legal counsel to ensure the structure and associated compensation meet the regulatory requirements of the Stark Law, the Anti-Kickback Statute, and the Internal Revenue Service.”

The full article was published in the December 12, 2023, issue of the AAPCP Bulletin, where it is available to AAPCP members and subscribers. View a PDF of the article.

This is the third in a series of PYA articles related to physician compensation design published in the bulletin. The first article, “Playing Offense: Using Compensation Design and Strategy to Retain Hospital-Employed Primary Care Physicians,” was published in May 2023, and the second article, “Understanding Group Compensation Model Design for Hospital-Employed Physician Practices,” was published in August 2023.

The AAPCP is the largest nonprofit organization in the country devoted to provider compensation, contracting, and alignment. The organization’s members advise and lead organizations on provider compensation, contracting, planning, recruitment, retention, strategy, and valuation.

For additional guidance related to provider compensation design or any matter related to fair market value compensation, valuation, compliance, or strategy and integration, one of our executive contacts would be happy to assist. You may email them below or call (800) 270-9629.

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