New York Codes, Rules and Regulations › Title 10 - DEPARTMENT OF HEALTH › Chapter V - Medical Facilities › Subchapter A - Medical Facilities-minimum Standards › Article 8 - New York State Annual Hospital Report › Part 442 - Reporting Principles And Concepts › Specialized Reporting Areas › Section 442.28 - Physician remuneration

Current through Register Vol. 46, No. 28, July 10, 2024
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(a) Due to the numerous types of financial
						and work arrangements between hospitals and hospital-based physicians,
						comparability of costs between hospitals may be significantly impaired. This
						section deals with the methods to be used in recording costs and revenues
						related to the services of hospital-based physicians.
(b)
Financial arrangements.
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(1)
						Although the variations in financial arrangements between hospitals and
						hospital-based physicians are endless, there are five general types of such
						arrangements:
(i) Agency arrangement. The
						hospital bills patients for the physician's professional services, but records
						these billings as liabilities and the subsequent payment to the physician as a
						reduction of that liability. The hospital reflects no operating revenue or
						expense relative to the professional component.
(ii) Compensation arrangement. The hospital
						bills patients for the physician's contractual professional services, including
						this amount as hospital revenue. All cost center expenses are paid by the
						hospital. The hospital remits a fee or pays a salary to the physician which is
						included in hospital expense. The compensation arrangement can be either fixed
						or variable. Under a fixed compensation arrangement the physician is paid a
						specific dollar amount (salary) unrelated to volume of services rendered. Under
						the variable compensation arrangement the physician's compensation will be a
						percentage of departmental gross charges or net collections. The actual
						compensation received by the physician will vary in proportion to the number of
						procedures performed and to the total charges made by the hospital. This
						arrangement includes those physicians providing patient services in the Daily
						Hospital Services cost centers.
(iii) Contracted arrangement. Under this
						arrangement, the physician may pay any or all expenses of the cost center. The
						hospital bills patients for the departmental services and remits a fee to the
						physician. This fee would typically be designed to cover the expenses incurred
						by the physician and are recorded as Professional Fees (Natural classification
						of expense.31) regardless of the expenses incurred by the physician.
(iv) Rental arrangement. The physician bills
						the patients for certain of the Part A and Part B component (as defined by
						Medicare) and incurs all substantial direct expenses. The physician remits a
						fee to cover certain hospital expenses. This fee is recorded as operating
						revenue in the appropriate revenue center.
(v) Independent/separate arrangement. The
						functions are provided by an independent physician or group of physicians.
						Neither revenues nor expenses are incurred by the hospital. The hospital refers
						patients and/or specimens to the physician or group, which is usually located
						on separate premises. No costs are incurred and no revenue is received under
						this arrangement.