[Material Transmitted:]{.underline}

HHS Instruction 590-1,Title 38 Physician Special Pay

[Material Superseded:]{.underline}

None.

[Background:]{.underline}

This is the first Departmental Instruction to be published on the
subject of payment of Physician Special Pay (PSP) based on 38 U.S. Code,
Chapter 74, and the U.S. Office of Personnel Management (OPM) Title 38
Delegation Agreement. It was written to provide clear, consistent
guidance to the health agencies and to abide by the USOPM/DHHS
delegation agreement which requires a Departmental plan of action for
the implementation of Title 38.

Any reference to "OPDIV" in this Instruction now includes AHCPR, ATSDR,
CDC, FDA, HRSA, IHS, NIH, SAMHSA, the Office of the Secretary, the
Program Support Center, HCFA, ACF, and AOA.

This issuance is effective immediately. Implementation under this
issuance must be carried out in accordance with applicable laws, the
USOPM/DHHS delegation agreement, and bargaining agreements.

[Filing Instructions:]{.underline}

File new material. Post receipt of this transmittal to the HHS Check
List of Transmittal and file this transmittal in sequential order after
the check list.

John J. Callahan

Assistant Secretary for

Management and Budget

# INSTRUCTION 590-1

Distribution: MS (PERS): HRFC-001

***Internet Note: Copies of Exhibit 590-1-A (HHS Form 691) and
Exhibit***

***590-1-B (HHS Form 691-1) will only be found as separate attachments
to the PDF copy of this document. They are also available at
http://forms.psc.dhhs.gov/hhsforms.htm***

[HHS PERSONNEL INSTRUCTION 590-1]{.underline}

[TITLE 38 PHYSICIAN SPECIAL PAY]{.underline}

590-1-00 Purpose

10 Coverage and Exclusions

20 References

30 Policy

40 Responsibilities

50 Special Pay Factors

60 Case Documentation, Procedures and Processing

70 Annual Review Requirements and Procedures

80 Annuity Contributions and Calculations

90 Evaluation and Reporting

Exhibit 590-1-A, Request for Special Pay for Physicians and Dentists,
HHS Form 691

Exhibit 590-1-B, Employee Service Agreement, HHS Form 691-1

Exhibit 590-1-C, Summary of Title 38 Physician Special Pay

Delegations of Authority

Exhibit 590-1-D, Physician Special Pay Amounts

590-1-00 PURPOSE

This Instruction describes HHS regulations and procedures for payment of
Physician Special Pay (PSP) to physicians and dentists.

590-1-10 COVERAGE AND EXCLUSIONS

A. [Coverage]{.underline}

This Instruction covers civilian physicians at GS-15 and below (or in an
equivalent substitute grading system, e.g., Title 38 rank-in-person
system) who:

1\. provide direct patient care services, or services incident to
patient care; and

2.  have been designated for coverage by appropriate

> authority.

3\. As used in this document, references to physicians include both
physicians and dentists, unless otherwise noted.

B. [Categorical Exclusions]{.underline}

This instruction does not apply to physicians who are:

1\. currently serving in the PHS Commissioned Corps;

2\. serving in an internship or residency training program;

3\. reemployed annuitants;

4\. in the SES, ES, SL/ST, SBRS, EL, EX, or other senior-level systems;

5\. receiving Physicians Comparability Allowance (PCA) under 5 U.S.Code
5948;

6\. employed or paid under a Title 42 authority;

7\. serving on an intermittent appointment;

8\. employed on a part-time basis with a scheduled tour of duty of less
than 20 hours per pay period; or

9\. serving in positions or categories of positions that have been
determined by the Operating Division (OPDIV) head or his/her designee as
having no significant recruitment/retention problem.

C. [Former Members of the Uniformed Services]{.underline}

Former members of the uniformed services, i.e., the Army, Navy, Air
Force, Marines, Coast Guard, National Oceanic and Atmospheric
Administration and the PHS Commissioned Corps, may receive Physician
Special Pay.

Regulations governing a former member's reemployment, annuity reduction,
repayment of outstanding uniformed service obligations, entitlement to
travel and transportation, annual leave transfer, etc., may be obtained
from the Director, Division of Commissioned Personnel, Office of the
Surgeon General, for PHS Commissioned Corps Officers. For former members
of other uniformed services, similar information may be obtained from
the employing office of the appropriate service branch.

D. [Scholarship Obligees and Loan Recipients]{.underline}

1\. Physicians who are fulfilling a service obligation in connection
with the National Health Service Corps or other Federal medical
scholarship or training programs are eligible to receive Physician
Special Pay, on a case-by-case basis, with the approval of the OPDIV
head.[1]{.underline}/ PSP normally will be paid to such obligees only
when it is determined to be essential to the retention of the
individual.

2\. Physicians who are receiving student loan repayment assistance under
Section 5379 of Title 5 or similar authority are eligible to receive
Physician Special Pay on a case-by-case basis, with the approval of the
OPDIV head. The amount of PSP that normally would be paid to loan
repayment recipients may be offset by an amount up to the annual loan
repayment. Physician Special Pay factors that may be reduced under this
provision include: Scarce Medical Specialty Pay, Executive
Responsibility Pay, Pay for Exceptional Qualifications Within a
Specialty, and Geographic Location Pay.

590-1-20 REFERENCES

A. 38 U.S. Code, Chapter 74 (law - veterans health administration -
personnel)

B.  5 U.S. Code 5371 (law - health care positions)

C.  C. Public Law 93-638, Section 102(e) - (h) (Indian Self-

Determination and Education Assistance Act)

D. Public Law 99-221, Section 3(a) (Cherokee Leasing Act)

E. U.S. Office of Personnel Management Title 38 Delegation Agreement,
dated June 30, 1997

590-1-30 P0LICY

A. [Discretionary Application]{.underline}

PSP is available for use to recruit and retain highly qualified
physicians. Payment of PSP is optional in each OPDIV. However, if paid
to a position or specific category of positions, other physicians
performing the same or similar duties in the same OPDIV must be
considered for PSP.

[1]{.underline}/Throughout this Instruction, references to OPDIV head
infers authorities may be redelegated.

> Within budgetary constraints, HHS policy is to compensate physicians
> at levels reasonably comparable with those paid to other Federal
> sector physicians in the same local area.

B. [Establishment of PSP Amounts]{.underline}

PSP amounts for physicians will be established on an individual basis
according to the special pay factors in Section 590-1-50, below, and HHS
Form 691 - Request for Special Pay for Physicians and Dentists.

Exhibit 590-1-C describes approval authorities for each of the special
pay factors.

C. [Relationship to Basic Pay]{.underline}

PSP is basic pay for purposes of Federal Employees Group Life Insurance.
Subject to the conditions in Section 590-1-80, below, PSP is also basic
pay for civil service retirement purposes under 5 U.S. Code Chapters 83
and 84, including the Thrift Savings Plan. It is basic pay for Workers
Compensation subject to the statutory maximum in Chapter 81, Title 5,
U.S. Code. It is also basic pay for Continuation of Pay under Chapter
81, Title 5, U.S. Code where applicable.

PSP is not basic pay for other pay administration purposes such as
severance pay, highest previous rate, or lump sum leave payments. PSP is
paid for hours in a pay status only.

D. [Relationship to Premium Pay Under Title 5]{.underline}

Physicians who receive PSP may **[not:]{.underline}**

1\. be paid overtime for work in excess of 8 hours per day,

40 hours per week, or 80 hours per pay period;

2\. earn compensatory time off; or

3\. receive any other form of premium pay under Chapter 55 of Title 5,
U.S. Code, e.g., Sunday, holiday, night pays.

E. [Other Discretionary Pay Under Title 5]{.underline}

Physicians who receive PSP may receive other forms of discretionary pay
under Title 5, such as awards, Recruitment and Relocation Bonuses and
Retention Allowances (5 U.S. Code 5753 and 5754). However, they are
**[not]{.underline}** eligible to receive a Physicians Comparability
Allowance under 5 U.S. Code 5948.

The sum of all pay components paid to a physician under Title 5
authority is limited on an annual basis to the rate of pay for EX-1.

F. [Aggregate Compensation Limits]{.underline}

Total compensation of physicians receiving PSP under Title 38 authority,
basic pay, and other supplemental pay under Title 5 cannot exceed the
amount of annual pay received by the President of the United States as
specified in Section 102 of Title 3 (\$200,000 as of the effective date
of this Instruction).

G. [Employee Service Agreements]{.underline}

Service agreements are required for physicians who receive PSP. HHS Form
691-1, Employee Service Agreement, will be used for this purpose.

> 1\. Service agreements will be for a minimum period of one year (26
> pay periods) and a maximum of four years (104 pay periods), and must
> be in one year increments. The length of the service agreement will be
> determined on a case-by-case basis in negotiations between the
> physician and designated management officials.

2\. Service agreements are employee commitments to remain in a position
for a specified period of time. They are not management contracts for
employment nor compensation, and do not preclude or limit the employer's
right to take corrective or disciplinary actions including termination
of PSP.

3\. The total amount of special pay reflected on the service agreement
may be adjusted to reflect changes in the Length of Service or Board
Certification, changes to or from a full-time tour of duty, changes to
the

> percentage of time devoted to a scarce medical specialty or executive
> responsibility, or to correct an administrative error.

4\. Except as provided in 5. and 6., below, employees who voluntarily or
because of misconduct fail to complete the period of service specified
in the service agreement will be required to refund the amount of PSP
received in the service agreement year as follows:

> a\. 100 percent of PSP monies received during the first year for
> failure during the first year;
>
> b\. 75 percent of PSP monies received during the second year for
> failure during the second year;
>
> c\. 50 percent of PSP monies received during the third year for
> failure during the third year; and

d\. 25 percent of PSP monies received during the fourth year for failure
during the fourth year.

5\. Repayment will be waived when failure to complete the service
agreement results from:

a\. reduction-in-force;

b\. transfer of function; or

c\. directed reassignment in connection with a reorganization announced
in writing by the employing agency.

6\. Repayment may be waived in other cases when failure to complete the
service agreement is the result of circumstances beyond the employee's
control. Such waivers must be documented on a case-by-case basis and
submitted by a management official in memorandum format, and must
describe:

a\. the circumstances necessitating the termination of service in the
position for which PSP was paid;

b\. the period of service that has yet to be completed; and

c\. the amount of PSP that was approved and the amount to be waived.

A copy of the Request for Special Pay for Physicians and Dentists, the
Employee Service Agreement, and the

Notification of Personnel Action initiating PSP should be forwarded with
the memorandum to the approving official.

7\. Physicians who accept a management-initiated offer to enter into a
new service agreement will have any unfulfilled period of service under
the superseded agreement waived. However, the new agreement must cover
at least the time remaining under the old.

8\. Physicians who convert from a Physicians Comparability Allowance
(PCA) Agreement to a Physicians Special Pay Agreement must sign an
agreement which covers at least the time remaining under the PCA
agreement, but not less than one year.

9\. Service agreements will be signed by the employee only after the HHS
691 has been approved by the approving official and the amount of PSP
has been recorded on the service agreement.

10\. The terms used on the Request for Special Pay will determine the
nature of the service agreement:

**New Agreement:** An agreement with a physician who was not previously
receiving PSP.

**Renewal Agreement:** An agreement with a physician who has been
receiving PSP.

**Amendment:** A change in the terms of an existing agreement.

H. [Effective Dates]{.underline}

PSP will usually be effective at the beginning of the pay period
immediately following approval by the approving official or on a later
date specified on HHS Form 691. Occasionally, employees enter on duty
(EOD) on a day other than the first day of a pay period. When that
occurs,

agreements may be effective coincident with the employee's EOD date.

A new service agreement may be negotiated prior to the expiration date
of a previous agreement with the mutual agreement of management and the
employee.

PSP may not be approved retroactively. However, an administrative error
may be corrected retroactively.

I. [Payment of PSP]{.underline}

PSP will be paid on a biweekly basis and will continue for the period of
time specified in the service agreement, unless terminated under the
conditions specified in J. below.

J. [Termination of PSP]{.underline}

PSP agreements initiated at the beginning of a pay period will generally
be terminated on the last day of the 26^th^, 52^nd^, 78^th^, or 104^th^
pay period. It is advisable to negotiate future agreements effective at
the beginning of a pay period, so subsequent agreements coincide with
the beginning of a pay period.

Any of the following conditions will result in the termination of PSP
prior to the date specified in the service agreement:

1\. a significant change in the duties and responsibilities of the
physician's assignment. Such changes normally would be reflected in a
personnel action, e.g., promotion, change-to-lower-grade, reassignment
to a new position with significantly different duties;

2\. separation of the employee from his/her position or employing
organization due to transfer, resignation, retirement, etc.;

3\. change in tour of duty to a less than quarter-time status; or

4\. execution of a superseding agreement.

A PSP agreement normally will not be terminated if the employee is
subject to a personnel action that does not involve a position change,
e.g., reassignment to a successor position as a result of
reorganization. In such a case, an amended HHS-691 should be prepared as
described in Section 590-1-60D.

K. [Renewals of or Amendments to PSP]{.underline}

1\. PSP is subject to renewal at the expiration of the service period
required in the original agreement. At the time of renewal, the basis
for each special pay factor amount will be reviewed and adjusted as
appropriate.

2\. Amendments to the PSP amount may be made (without affecting the
period of service obligation specified in the original service
agreement) when a physician is affected by changes in Board
Certification or Length of Service; is reassigned with no major change
in duties or change in compensation; or when the tour of duty changes to
or from full-time.

L. [Outside Work]{.underline}

Because of the work obligation associated with full-time status,
full-time physicians who wish to perform outside work must submit a
prior written request under established agency procedures. Any activity
interfering or conflicting with the employee's work obligation will be
disapproved.

M. [Part-Time Service]{.underline}

Part-time physicians who have a tour of duty of at least 20 hours per
pay period may be offered PSP. PSP amounts for the special pay factors
in Exhibit 590-1-D will be prorated for part-time service with the
exception of the Full-Time Status factor that is payable only to
full-time physicians. Proration of other factors will be based on the
number of hours in the employee's regular tour of duty, but must not
exceed 75 percent of the amount that would be paid if the physician were
full-time. The 75 percent maximum PSP payment will be applied on a pay
period basis.

N. [Relationship to Leave Under Title 5]{.underline}

Physicians who receive PSP continue to be covered by the leave
provisions of Chapter 63 of Title 5.

590-1-40 RESPONSIBILITIES

A. OPDIV heads are responsible for ensuring that merit system principles
and the requirements of the Title 38 statute, the USOPM/DHHS delegation
agreement, and this Instruction are followed in their use of Physician
Special Pay.

B. OPDIV heads are responsible for sharing information regarding the
OPDIVs use of facility-specific Scarce Medical Specialty Pay and
Geographic Location Pay with other Federal facilities that use Title 38
Physician Special Pay provisions and are collocated with an OPDIV field
facility.

C. OPDIV heads are responsible for reviewing requests for approval of
outside work activities from full-time physicians for possible conflict
of interest with work obligations incurred in connection with payment of
the Full-Time Status factor.

D. OPDIV heads are responsible for maintaining auditable program
records, and participating in evaluation of this authority by USOPM,
DHHS, or other administrative authority.

E. The Assistant Secretary for Management and Budget (ASMB) is
responsible for obtaining the concurrence of the Interagency Committee
for Health Care Occupations on the HHS Physician Special Pay Plan.

F. The ASMB is responsible for sharing information regarding the use of
Scarce Medical Specialty Pay on a nationwide basis or within the
Washington, D.C. metropolitan area, and Geographic Location Pay in the
Washington, D.C. metropolitan area, with other Federal agencies that use
Title 38 Physician Special Pay.

G. The ASMB is responsible for preparing the annual report of use of
Physician Special Pay required in the USOPM/DHHS delegation agreement
and for participating in the evaluation of this authority by USOPM,
DHHS, or other administrative authority.

H. Personnel Officers with appointing authority are responsible for
reviewing and certifying that PSP requests and service agreements for
employees they service comply with the

provisions of law, the USOPM/DHHS delegation agreement, and this
Instruction.

Exhibit 590-1-C provides a summary of the major PSP authorities and the
level at which they are applied.

590-1-50 SPECIAL PAY FACTORS

Amounts of Special Pay factors are addressed in Exhibit 590-1-D.

A. [Full-Time Status]{.underline}

Physicians employed on a full-time basis shall be paid PSP for full-time
status and are considered to be in on-call status 24 hours a day, 7 days
a week. This factor is to be uniformly applied to covered physicians.
The amount may not be negotiated nor may it be prorated for part-time
service.

B. [Length of Service]{.underline}

1\. Length of Service rates must be applied uniformly to all covered
physicians.

2\. In calculating length of service for payment of this

factor, the following types of service are creditable:

a\. service as a civilian physician in the Public Health Service under
Title 5 or Title 42, U. S. Code or as a uniformed Medical Officer in
active service of the PHS Commissioned Corps. (Note: Service to the
Public Health Service under a non-employment program is not creditable
toward the length of service calculation.)

b\. employment with an Indian Health Service tribal government or
organization, for which the employee maintained Federal retirement
benefits under Chapter 83 or 84 of 5 U.S. Code upon separation from
Federal service. See Section 102(e)-(h) of Public Law 93-638, and Public
Law 99-221, section 3(a) for further information.

c\. employment as a physician of the Veterans Health Administration
under: 38 U.S. Code 7306, or former authority; 38 U.S. Code 7401 (1), or
former authority; 38 U.S. Code 7405-7407; or under a career residency,
VA fellowship, or other VA employment creditable in length of service
determinations within the VA.

3\. Years of service will be calculated on the basis of 365 calendar
days for one year of service. Service years may not include LWOP or
other service in a non-pay status exceeding six months in a calendar
year.

4\. Individuals become eligible for this component of special pay at the
beginning of the first pay period following completion of the required
years of service.

C. [Scarce Medical Specialty]{.underline}

This component of special pay is payable to a physician who is
specialty-trained and provides services in a specialty for which the
agency has determined there is an **extraordinary** difficulty in
recruitment/retention.

1\. Establishment of Categories for Scarce Medical Specialty:

a\. Scarce Medical Specialty Pay may be established on a nationwide
basis or on the needs of a specific facility.

b\. Facility-specific Scarce Medical Specialty Pay may be established
only when Geographic Location Pay is not sufficient to address the
recruitment/retention needs of the facility.

c\. The dollar range of pay for a specific Scarce Medical Specialty for
physicians must be from \$0 to \$40,000; for dentists the amount must be
from \$0 to \$20,000.

d\. In determining the need for Scarce Medical Specialty Pay and in
setting the range of pay for the specialty, the approving official will
consider:

(1) the success of recent efforts to recruit high quality candidates to
    the specialty position or

> category, including indicators such as vacancy rates, turnover rates,
> duration of vacancies, offer acceptance rates;

\(2\) recent turnover in the specialty;

\(3\) compensation earned by physicians in the specialty in competitor
organizations, as shown in published salary surveys such as those
conducted by the American Medical Association, the American Academy of
Medical Colleges, the HAY Associates, the Wyatt Company, etc., or in a
locally-conducted survey; or for dentists, as shown in published salary
surveys such as those conducted by the American Dental Association,
American Association of Dental Schools;

\(4\) labor-market factors that may affect the ability of the OPDIV to
recruit or retain quality candidates in the specialty or category now or
in the future, e.g., assessment of availability of specialized skills in
the labor market, discussion of physician supply from graduate
medical/dental programs;

\(5\) the cost of contract services that have been used to provide the
specialty service; and/or

\(6\) any other factors that reflect on the ability of the OPDIV to
recruit and/or retain physicians in the specialty or category.

e\. The requirements of d. above, will be waived when

another Federal agency has established Scarce Medical Specialty Pay for
a specialty, either nationwide or on a specific geographic basis. In
such cases, HHS Scarce Medical Specialty Pay may be established, with no
further documentation required, for that specialty in the same
geographic area.

Proposed rates that expand the geographic area of application will
require additional documentation of need as described in d., above.

f\. Officials who propose to establish facility-specific Scarce Medical
Specialty Pay in a location where other Federal health care facilities
are located must: (1) inform any other collocated HHS facilities or
other Federal facilities that use the provisions of Title 38, of the
intent to recommend or establish facility-specific pay, and (2) share
information regarding the salaries and labor market conditions for the
specialty concerned.

g\. OPDIVs will maintain a list of approved facility specific Scarce
Medical Specialty/ies and a record of the justification used in
establishing both the need for and the amount of the Scarce Medical
Specialty Pay. The OPDIV will provide this information to the Office of
Human Resources, Assistant Secretary for Management and Budget
(OHR/ASMB) within 15 days of approval.

h\. Both nationwide and facility-specific Scarce Medical Specialty Pay
will be subject to an annual review for continued designation as a
scarce specialty and for the appropriateness of the range of pay
established (see Section 590-1-70). Reviews will be performed by the
designated official, and will focus on any changes in: 1) labor market
factors that may impact on the OPDIV's ability to recruit and/or retain
physicians in the specialty, and 2) the compensation of physicians in
the specialty as reported in published salary surveys (see Section
1.d.(3) above). Records of reviews will be maintained as part of the
agency\'s plan for using Physician Special Pay and provided to OHR/ASMB.

2\. Application of Scarce Medical Specialty Pay to Individuals

a\. The amount of Scarce Medical Specialty Pay to be paid

to an individual will be based on an assessment of:

\(1\) the individual\'s qualifications and skills in the specialty area,
as shown by academic credentials or work experience;

\(2\) the relevance of the individual\'s qualifications and skills to
the position concerned;

\(3\) the length of time the physician agrees to serve in the position;
and/or

\(4\) other relevant factors.

Approving officials may use the services of a physician peer review
group or a standards review board to recommend the amount of Scarce
Medical Specialty Pay to be paid.

b\. Individuals who perform multiple roles, e.g., Service

Chief who also performs Scarce Medical Specialty duties, may receive
Scarce Medical Specialty Pay only for the proportion of time they
actually work in the specialty. The proportion will be expressed as an
annual percentage of time spent in the Scarce Medical Specialty. The
percentage will be established at the time of the initial service
agreement and must be verified prior to renewal of a service agreement.
The percentage of time must be recorded in the position description and
in Block 4 of HHS Form 691.

D. [Executive Responsibility Pay]{.underline}

1\. This component of special pay is payable to individuals who provide
services as a Service Chief or Chief of Staff.

Note: Although the USOPM/DHHS Delegation Agreement

references all of the executive positions described in Section
7433(b)(4) of Title 38, the following positions or grades may not be
applied within HHS: Director Grade, Deputy Service Director, Service
Director, Deputy Assistant Chief Medical Director, Assistant Chief
Medical Director, Associate Chief Medical Director, Deputy Chief Medical
Director, and Medical Director. Since these VA positions/grades are
equivalent to Title 5 supergrade positions, i.e., SES, SL/ST, etc., and
the legal authority for application of T.38 authorities within HHS is
limited to GS-15 and below, these levels are not currently available to
HHS.

2\. Physicians who perform multiple roles, e.g., a Service Chief who
also performs clinical duties, may receive Executive Responsibility Pay
only for the proportion of time they actually devote to executive work.
In such cases, the proportion of time will be expressed as an annual
percentage of time spent in the executive assignment. The percentage
will be established at the time of the initial PSP request and prior to
renewal of PSP. The percentage of time must be recorded in the position
description and in Block 4 of HHS Form 691.

3\. Eligibility for Executive Responsibility Pay will be

Based on the following definitions:

a\. Service Chief

To be considered a Service Chief, a physician must

\(1\) head a recognized organizational unit that provides direct patient
care services or services incident to patient care **and** provide
technical supervision to one or more physicians or other health care
professionals; **or**

\(2\) be the Clinical Director at an outpatient or free-standing clinic.

b\. Chief of Staff Positions

To be equivalent to a Chief of Staff, a physician must

\(1\) be a second-level supervisor; **and** manage an organizational
unit that is subdivided into distinct functional groups;
**[or]{.underline}**

\(2\) be the Clinical Director of a hospital.

OPDIVs will establish and maintain a list of positions to which these
provisions apply, and maintain the list as part of the plan for using

Physician Special Pay.

4\. Setting Individual Executive Responsibility Pay

a\. The amount of Executive Responsibility Pay will be established
individually within the statutory ranges shown in Exhibit 590-1-D.

b\. In setting the amount to be paid, the deciding official will assess:

\(1\) the individual\'s executive qualifications and skills as shown by
work experience and/or training;

\(2\) the relevance of the individual\'s executive experience to the
position;

\(3\) length of assignment as a Service Chief or Chief of Staff in the
position or comparable positions;

\(4\) the complexity of the organization managed; and

\(5\) any other factors that reflect on the physician's ability to
perform the executive assignment.

E. [Board Certification Pay]{.underline}

1\. This component is payable to individuals who have one or more
current specialty certificates or subspecialty certificates from the
American Board of Medical Specialties, the Advisory Board for
Osteopathic

Specialists, or the Council on Dental Education, American Dental
Association.

At the request of an OPDIV head, the Assistant Secretary for Health will
consider the designation of certificates from other board organizations.
Requests must provide a comprehensive discussion of the nature of the
organization's boarding process and a discussion of whether application
has been made for recognition of the board by the certifying agencies
noted above.

2\. The amount of pay for a specialty certification or first

Board certification is established by statute at \$2,000. The amount for
a subspecialty certification or secondary

> board certification is an additional \$500. These rates are applied
> uniformly to all physicians and dentists who possess the board
> certifications noted in paragraph 1., above. The maximum amount of pay
> for this component is \$2,500.

3\. Individuals entering into service agreements will record their
current board certification status on the Employee Service Agreement,
HHS 691-1, provide a copy of their certification to agency officials,
and inform their supervisor of any change to their board status. Payment
will be based on this record of board status and will be discontinued if
the certification is rescinded, suspended, or expired.

F. [Geographic Location Pay]{.underline}

This component is payable to physicians who provide services

in a specific category of position or specialty at a geographic location
for which there is an **extraordinary** difficulty in the
recruitment/retention of qualified physicians.

Establishment of Geographic Location Pay

1\. Geographic Location Pay may be established on a specific geographic
basis, i.e., regional, area-wide, city-wide, etc., or on the needs of a
specific facility.

2\. Geographic Location Pay will be established at a flat rate of pay
within the statutory maximums reflected in Exhibit 590-1-D.

3\. The payment of geographic pay to individual physicians within the
category or specialty will be uniform, unless a specific exception is
approved in writing. The reasons for such exceptions must be documented
and maintained with the HHS Form 691.

4\. In determining the need for Geographic Location Pay and

in setting the rate of pay for the location, the following will be
considered:

a.  the success of recent efforts to recruit high quality candidates in
    the position or category, including

> indicators such as vacancy rates, turnover rates, duration of
> vacancies, offer acceptance rates;

b\. recent turnover in the position or category;

c\. the compensation earned by physicians in the category in competitor
organizations, as shown in published salary surveys;

d\. the characteristics of the geographic area, as shown by:

\(1\) a comparative assessment of the cost-of-living for the area versus
\"standard city\" data. A Runzheimer International Two-Location Living
Cost Comparison will be used for this purpose; and/or

\(2\) a description of any adverse factors that might impede the
recruitment or retention of physicians to the location, i.e., remoteness
of site, lack of educational or other services, etc.;

e\. labor-market factors that may affect the ability of

the agency to recruit or retain quality candidates in the category now
or in the future, e.g., assessment of availability of required skills in
the labor market, discussion of physician supply from graduate medical
programs;

f\. the cost of contract services that have been used to

provide the service; and/or

g\. any other factors that reflect on the ability of the OPDIV to
recruit and/or retain physicians in the positions or category at the
geographic location.

5\. The requirements of 4.d., above, will be waived when

Another Federal agency has established Geographic Location Pay for the
same geographic area. In such cases, no further documentation is
required for the same category or specialty in the same geographic area.

Expansion of the geographic area of application, or the category of
physician to which the pay applies will require documentation of need as
described in 4.d. above.

Prior to authorizing a rate for an OPDIV facility (ies)

on the basis of a VA authorization, OPDIV officials must consult local
VA officials to determine the rate of pay established in the geographic
area, the date of authorization of the Geographic Location Pay, and the
date it will expire.

6\. An official who proposes to establish Geographic Location Pay where
other Federal health care facilities that use the provisions of
Physician Special Pay under Title 38 are collocated must: (1) inform
those facilities of the intent to establish Geographic Location Pay, and
(2) share data regarding geographic or labor market conditions and
salary information.

7\. OPDIVs must maintain a list of approved Geographic Location Pay as
part of the plan for PSP, and provide the list to ASMB Office of Human
Resources within 15 days of approval.

G. [Pay for Exceptional Qualifications Within a Specialty]{.underline}

1\. This factor is available for payment to physicians who possess
exceptional qualifications within a specialty, when the total physician
special pay that would be payable does not exceed the total amount of
PSP that may be paid, under factors A.- F., above, to other physicians
who:

a\. possess the same length of service, and

b\. are assigned to the same specialty and position.

2.  This factor must be justified individually on a

> case-by-case basis and must reflect an assessment of the physician's
> exceptional qualifications.

3\. In determining Pay for Exceptional Qualifications within a
Specialty, the following will be considered:

a\. the outstanding or unique nature of the individual's experience or
educational background;

b\. the relevance of the individual\'s background to the specific needs
of the employing organization; or

c\. the individual\'s stature within his/her field as evidenced by:

\(1\) presentations or invitations to speak at national or international
professional meetings and conferences;

\(2\) authorship of publications, such as articles in

refereed journals or books;

\(3\) requests for advice or consultation from physicians outside the
employing organization; and

\(4\) other similar factors.

4\. The comparative review of special pay amounts for physicians with
the same length of service, specialty and position concerned will be
done within the primary organizational unit in which the physician is
employed. Documentation of the comparative review done must be attached
to the Form HHS 691.

590-1-60 CASE DOCUMENTATION, PROCEDURES AND PROCESSING

A. [New or Renewal Actions]{.underline}

Management officials proposing Physician Special Pay must complete HHS
Form 691 and provide:

1\. written justification if a proposed action includes the use of
Exceptional Qualifications within a Specialty;

2\. written justification of the amount of Scarce Medical

Specialty pay and/or Executive Responsibility Pay for cases where total
proposed compensation exceeds EX-1;

3\. a copy of the candidate\'s/employee\'s qualifications statement or
curriculum vitae;

> 4\. the position description;
>
> 5\. a copy of the proposed (unsigned) Employee Service Agreement that
> will be negotiated with the employee once PSP is approved; and
>
> 6\. any other relevant information.

B. Information listed in A. should be forwarded by the

recommending official to the approving official for review and approval.

C. Once approved, cases will be forwarded with supporting

documentation to the servicing personnel office for:

1\. completion of the Employee Service Agreement;

2\. processing of a Notification of Personnel Action (SF‑50); and

3\. maintenance of records in the employee\'s Official Personnel Folder
(OPF). Note: Maintain supporting documentation on the left side of the
OPF for two years from the expiration of the service agreement.

D. [Procedures for Amendment of PSP]{.underline}

1\. Personnel offices will complete HHS Form 691, for an Amendment
action (see 590-1-30K.2). Only the signature of the Personnel Officer is
required.

2\. Attach the completed amendment to the original Form 691 in the OPF.

3\. A new service agreement, Form HHS 691-1, is not required.

4\. A copy of the Form HHS 691 documenting the amendment will be
provided to the employee.

590-1-70 ANNUAL REVIEW REQUIREMENTS AND PROCEDURES

By September 30 of each year, the following special pay factors will be
reviewed by the approving official for continued appropriateness and any
adjustment necessary:

1\. the uniform HHS Length of Service rates;

2\. designation of specialties or categories approved for receipt of
nationwide Scarce Medical Specialty Pay and the rates or ranges assigned
to each approved category;

3\. designation of the specialties or categories approved for
facility-specific Scarce Medical Specialty Pay and the rates or ranges
assigned to each approved category;

4\. Geographic Location Pay; and

5\. the approved list of board specialties recognized for Board
Certification Pay.

##  Committees may be used to conduct such reviews and to make

recommendations to the approving official.

The elements considered in maintaining or revising

> authorizations, as described in Section 590-1-50., above, will be
> documented as part of the review record. Copies of completed reviews
> will be maintained as part of an OPDIV's plan for use of PSP for
> authorities delegated to the OPDIV head. The ASMB, Office of Human
> Resources, will maintain records of reviews for authorities delegated
> to the ASMB.

590-1-80 ANNUITY CONTRIBUTIONS AND CALCULATIONS

### A. The total amount of Physician Special Pay paid under this

authority is subject to employee deduction for civil service annuity
purposes under 5 U.S. Code, Chapters 83 and 84, at the rates established
in those Chapters. The employing agency also will make annuity
contributions from the appropriation or other fund used to pay the
employee. Agency

contributions will be at the percentage rates specified for basic pay
contribution under 5. U.S. Code, Chapters 83 and 84.

B. Except as provided in D., below, a physician who enters into

a Physician Special Pay Agreement must complete 15 years of
retirement-creditable service as defined in paragraph C., below, in
order to have Physician Special Pay included as basic pay in determining
the civil service annuity.

In addition, for physicians with service that precedes the authorization
of PSP, there is an 8 year phase-in of the use of PSP in the calculation
of annuity. This phase-in will begin on the date of the physician\'s
initial PSP contract or the date HHS received the authority to begin
paying PSP, whichever is later. In such cases, PSP will be counted in
the annuity computation on the basis of 25 percent for every 2 years of
post-PSP service.

C. Retirement creditable service includes service as:

1\. a civilian physician in the Public Health Service under Title 5 or
Title 42. Note: Service in the Public Health Service under a
non-employment program is not creditable toward the length of service
calculation;

2\. employment with an Indian Health Service tribal

government or organization, for which the employee maintains Federal
retirement benefits under Chapter 83 or 84 of 5 U.S. Code upon
separation from Federal service. See Section 102(e)-(h) of Public Law
93-638, and Public Law 99-221, section 3(a) for further information; and

3\. employment as a physician of the Veterans Health

Administration under: 38 U.S. Code 7306, or former authority; 38 U.S.
Code 7401 (1), or former authority;

38 U.S. Code 7405-7407; or under a career residency, VA fellowship, or
other VA employment creditable within the VA.

Note: Service in the PHS Commissioned Corps is not

creditable toward the service requirements for annuity calculation.

D. Fulfillment of the 15 year creditable service requirement or the 8
year phase-in is not required for annuities paid under 5 U.S. Code 8337
or 8451, relating to disability retirement, or 5 U.S. Code 8341(d) or
(e) or 8442(b) or 8443, relating to survivor annuities.

E. Physicians who retire and who do not meet the 8 year phase-in

or the 15 year service requirement, as applicable, are not entitled to a
refund of retirement deductions from PSP.

F. Physicians who: 1) resign or are separated from Federal

service; 2) meet eligibility requirements for refund of retirement
deductions; and 3) make appropriate application for refund may receive
the employee retirement contributions from Physician Special Pay as part
of their refund amount.

590-1-90 EVALUATION AND REPORTING

OPDIV personnel officers will complete an annual assessment of the
overall effect of the payment of Physician Special Pay on the ability of
the OPDIV to recruit or retain high quality physicians. The report will
reflect the status as of December 31, and will be due on January 31. The
following format will be used for this assessment:

I. **Narrative.** This should be a brief but descriptive account of
agency activities regarding PSP.

A. Coverage

B. Oversight

C. Use of Medical Advisors for PSP

II\. **Effect of PSP on Recruitment and Retention of Physicians
(including both positive and negative influences).**

A. Retention

B. Recruitment

**III.** Problematic Issues

  --------------------------- ---------- ------------- -------------------------
  **AUTHORITY**               **HELD     **DELEGATED   **REMARKS**
                              BY**       TO**          

  1\. Establish Title 38      ASMB                     
  Physician Special Pay                                
  regulations and procedures                           

  2\. Approve requests for    ASMB       OPDIV heads   
  PSP when proposed total                              
  compensation exceeds                                 
  Executive Level I                                    

  3\. Approve PSP for         ASMB       OPDIV heads   
  individuals reporting                                
  directly to the OPDIV head                           

  4\. Establish uniform HHS   ASMB                     
  Length of Service rates                              

  5\. Establish nationwide    ASMB                     
  Scarce Medical Specialty                             
  ranges for a specialty or                            
  subspecialty                                         

  6\. Designate a specialty   ASMB       OPDIV heads   
  or subspecialty for Board                            
  Certification Pay                                    

  7\. Establish Scarce        ASMB       OPDIV heads   Requires collaboration
  Medical Specialty ranges                             and agreement with other
  for a specific                                       collocated OPDIVs; ASMB
  facility(ies) when more                              approval is required in
  than one OPDIV has                                   the absence of consensus.
  facilities collocated in                             
  the same geographic area                             

  8\. Establish Geographic    ASMB       OPDIV heads   Requires collaboration
  Location Pay for a specific                          and agreement with other
  category/categories of                               collocated OPDIVs; ASMB
  physicians when more than                            approval is required in
  one OPDIV has facilities                             the absence of consensus.
  collocated in the same                               
  geographic area                                      

  9\. Determine the           ASMB       OPDIV heads   
  categories of physicians or                          
  positions that will be                               
  considered for PSP                                   

  10\. Approve requests for   ASH/ASMB   OPDIV heads   
  Exceptional Qualifications                           
  Pay                                                  

  11\. Approve individual PSP ASMB       OPDIV heads   
  for employees at the rates                           
  and/or within the ranges                             
  authorized.                                          

  12\. Approve exceptions to  ASMB       OPDIV heads   
  Geographic Location Pay                              

  13\. Establish Scarce       ASMB       OPDIV heads   
  Medical Specialty pay                                
  ranges for a specific                                
  facility when there are no                           
  other facilities of another                          
  OPDIV within the geographic                          
  area                                                 

  14\. Establish Geographic   ASMB       OPDIV heads   
  Location Pay for a specific                          
  category/categories of                               
  physicians when there are                            
  no other facilities of                               
  another OPDIV located                                
  within the same geographic                           
  area                                                 

  15\. Approve requests for   ASMB       OPDIV heads   
  waiver of repayment of the                           
  prorata amount of PSP for                            
  failure to complete service                          
  agreements                                           
  --------------------------- ---------- ------------- -------------------------

**PHYSICIANS SPECIAL PAY FACTORS AND AMOUNTS**

**1. Full-time Service**

  ----------------------------------- -----------------------------------
  **Medical officers: \$9,000**       **Dentists: \$3,500**

  ----------------------------------- -----------------------------------

**2. Length of Service**

+--------+------------+------------+--------+-----------+------------+
| **M    |            |            | **Dent |           |            |
| edical |            |            | ists** |           |            |
| Offi   |            |            |        |           |            |
| cers** |            |            |        |           |            |
+--------+------------+------------+--------+-----------+------------+
| **[At  | **[But     | **[Dollar  | **[At  | **[But    | **[D       |
| le     | less       | A          | le     | less      | ollar]{.un |
| ast]{. | than]{.un  | mount]{.un | ast]{. | t         | derline}** |
| underl | derline}** | derline}** | underl | han]{.und |            |
| ine}** |            |            | ine}** | erline}** | **[A       |
|        | **3        | **\$       |        |           | mount]{.un |
| **2    | years**    | 4,000**    | **2    | **4 years | derline}** |
| y      |            |            | y      | 8 years** |            |
| ears** | **4        | **5,000**  | ears** |           | **\$       |
|        | years**    |            |        | **12      | 1,000**    |
| **3    |            | **6,000**  | **4    | years**   |            |
| y      | **5        |            | y      |           | **2,000**  |
| ears** | years**    | **8,000**  | ears** | **15      |            |
|        |            |            |        | years**   | **3,000**  |
| **4    | **6        | **9,000**  | **8    |           |            |
| y      | years**    |            | y      |           | **3,500**  |
| ears** |            | **10,000** | ears** |           |            |
|        | **7        |            |        |           | **4,000**  |
| **5    | years**    | **12,000** | **12   |           |            |
| y      |            |            | y      |           |            |
| ears** | **8        | **13,000** | ears** |           |            |
|        | years**    |            |        |           |            |
| **6    |            | **14,000** | **15+y |           |            |
| y      | **9        |            | ears** |           |            |
| ears** | years**    | **15,000** |        |           |            |
|        |            |            |        |           |            |
| **7    | **10       | **16,000** |        |           |            |
| y      | years**    |            |        |           |            |
| ears** |            | **17,000** |        |           |            |
|        | **11       |            |        |           |            |
| **8    | years**    | **18,000** |        |           |            |
| y      |            |            |        |           |            |
| ears** | **12       | **18,000** |        |           |            |
|        | years**    |            |        |           |            |
| **9    |            |            |        |           |            |
| y      | **13       |            |        |           |            |
| ears** | years**    |            |        |           |            |
|        |            |            |        |           |            |
| **10   | **14       |            |        |           |            |
| y      | years**    |            |        |           |            |
| ears** |            |            |        |           |            |
|        | **15       |            |        |           |            |
| **11   | years**    |            |        |           |            |
| y      |            |            |        |           |            |
| ears** |            |            |        |           |            |
|        |            |            |        |           |            |
| **12   |            |            |        |           |            |
| y      |            |            |        |           |            |
| ears** |            |            |        |           |            |
|        |            |            |        |           |            |
| **13   |            |            |        |           |            |
| y      |            |            |        |           |            |
| ears** |            |            |        |           |            |
|        |            |            |        |           |            |
| **14   |            |            |        |           |            |
| y      |            |            |        |           |            |
| ears** |            |            |        |           |            |
|        |            |            |        |           |            |
| **15+  |            |            |        |           |            |
| y      |            |            |        |           |            |
| ears** |            |            |        |           |            |
+--------+------------+------------+--------+-----------+------------+

**3. Scarce Medical Specialty (Nationwide)**

+-----------------------------------+-----------------------------------+
| **MEDICAL OFFICERS**              | **DENTISTS**                      |
+-----------------------------------+-----------------------------------+
| STATUTORY LIMITATION - \$40,000   | STATUTORY LIMITATION - \$20,000   |
+-----------------------------------+-----------------------------------+
| [0 - \$40,000 Range:]{.underline} |                                   |
|                                   |                                   |
| Anesthesiology                    |                                   |
|                                   |                                   |
| Cardiac Surgery (Open Heart)      |                                   |
|                                   |                                   |
| Gynecology (including Obstetrics) |                                   |
|                                   |                                   |
| Neurosurgery                      |                                   |
|                                   |                                   |
| Ophthalmology                     |                                   |
|                                   |                                   |
| Orthopedic Surgery                |                                   |
|                                   |                                   |
| Plastic Surgery                   |                                   |
|                                   |                                   |
| Radiology                         |                                   |
|                                   |                                   |
| Thoracic Surgery                  |                                   |
|                                   |                                   |
| Vascular Surgery                  |                                   |
+-----------------------------------+-----------------------------------+
| [0 - \$30,000 Range:]{.underline} |                                   |
|                                   |                                   |
| Cardiology                        |                                   |
|                                   |                                   |
| General Surgery                   |                                   |
|                                   |                                   |
| Nuclear Medicine                  |                                   |
|                                   |                                   |
| Otolaryngology                    |                                   |
|                                   |                                   |
| Urology                           |                                   |
+-----------------------------------+-----------------------------------+
| [0 - \$20,000 Range:]{.underline} | [0 - \$20,000 Range:]{.underline} |
|                                   |                                   |
| Gastroenterology                  | Oral Maxillofacial Surgery        |
|                                   |                                   |
| Psychiatry                        |                                   |
|                                   |                                   |
| Pathology                         |                                   |
+-----------------------------------+-----------------------------------+
| [0 - 15,000 Range:]{.underline}   |                                   |
|                                   |                                   |
| Primary Care[^1]                  |                                   |
|                                   |                                   |
| Physical Medicine &               |                                   |
| Rehabilitation                    |                                   |
+-----------------------------------+-----------------------------------+

**4. Executive Responsibility**[^2]

  ----------------------- ----------------------- -----------------------
                          **Medical Officers**    **Dentists**

  **Service Chief**       **\$4,500 - \$15,000**  **\$1,000 - \$5,000**

  **Chief of Staff**      **\$14,500 - \$25,000** **\$1,000 - \$8,000**
  ----------------------- ----------------------- -----------------------

**5. Board Certification**

  ----------------------- ----------------------- -----------------------
                          **Medical Officers**    **Dentists**

  **First Specialty**     **\$2,000**             **\$2,000**

  **Second Specialty**    **500**                 **500**
  ----------------------- ----------------------- -----------------------

**6. Geographic Location**[^3]

  ----------------------------------- -----------------------------------
  **Medical Officers**                **Dentists**

  **0 - \$17,000**                    **0 - \$5,000**
  ----------------------------------- -----------------------------------

**7. Exceptional Qualifications**[^4]

  ----------------------------------- -----------------------------------
  **Medical Officers**                **Dentists**

  **0 - \$15,000**                    **0 - \$5,000**
  ----------------------------------- -----------------------------------

[^1]: For purposes of eligibility for this component, primary care
    represents the basic level of patient care. It consists of the
    delivery of acute and chronic care for medical, psychiatric and
    social conditions, delivery of preventive health interventions,
    patient and caregiver education, referral for specialty care when
    indicated, and the overall management and coordination of care for
    an individual. Primary Care also generally includes management of
    medications for an individual.

[^2]: Dollar amounts for Scarce Medical Specialty and Executive
    Responsibility must be prorated based on the amount of time spent in
    each capacity. Total may not exceed 100% of full-time employment.

[^3]: Established as a flat rate within the ranges shown.

[^4]: Established as a flat rate within the ranges shown.