THE ROBERT WOOD JOHNSON MEDICAL SCHOOL Exhibit 2. Operating Statements for The Robert Wood Johnson University Hospital Year Ends on December 31 Last Year This Year Patient service revenue: Inpatient services $135,678,752 $115,285,081 Outpatient services 19,977,236 16,637,939 Gross patient service revenue $155,655,988 $131,923,020 Deductions from (additions to) patient service revenue: Revision of prior years' estimates ($19,380,151) ($10,825,004) Contractual allowances-current year 19,975,945 11,963,985 Uncompensated care 7,920,769 11,347,618 Net deductions from gross patient service revenue $8 ,516,563 $12,486,599 Net patient service revenue $147,139,425 $119,436,421 Other operating revenue 9,638,854 5,826,704 Total operating revenue $156,778,279 $125,263,125 Operating expenses: Professional care of patients $90,568,494 $77,544,795 Household, dietary and property services 14,383,172 12,736,385 Administrative and general services 17,054,345 13,333,633 Employee health and welfare 10,667,050 8,619,903 Provision for depreciation & amortization 7,778,235 6,349,785 Interest 3,211,036 3,339,188 Total operating expenses $143,662,332 $121,923,689 Income from operations $13,115,947 $3,339,436 Nonoperating revenue, net: Unrestricted gifts and bequests 143,424 152,593 Unrestricted income from investments 1,752,434 1,330,387 Other (140,707) (707,286) Nonoperating revenue, net $1,755,151 $775,694 Excess of revenues over expenses $14,871,098 $4,115,130THE ROBERT WOOD JOHNSON MEDICAL SCHOOL Exhibit 3. Incentive Plan Unit Values CRITERIA UNIT VALUES Academic Rank Instructor Assistant Professor 00 ON A NO Associate Professor Professor Departments Administrative Positions Resident Liaison Section Head Director of Research Clinical Director Residency Coordinator Vice Chairman Medical Student Coordinator Performance Best Research Output (largest number of papers produced in the preceding six month period) Second Best Research Output Third Best Research Output Greatest Clinical Output (billing) Second Greatest Clinical Output WHNHNNWNN W Third Greatest Clinical Output Largest Number of Lecture Hours Taught Outstanding Teacher of the Year Award Ten Years Continuous Service Twenty Years Continuous ServiceTHE ROBERT WOOD JOHNSON MEDICAL SCHOOL Exhibit 4. Quarterly Faculty Incentive Report Dear As per the regulations for the distribution faculty incentive plan money, you have been awarded as your in- centive for this quarter the amount of $. You have been credited with the following incentive plan units: ACADEMIC RANK UNIT VALUES CREDITED Instructor Assistant Professor Associate Professor IIII Professor DEPARTMENT'S ADMINISTRATIVE POSITIONS Resident Liaison Section Head Clinical Director Director of Research ALANANN Residency Coordinator Vice Chairman Medical Student Coordinator PERFORMANCE Best Research Output Second Best Research Output Third Best Research Output Greatest Clinical Output Second Greatest Clinical Output Third Greatest Clinical Output Largest Number of Lecture Hours Taught Outstanding Teacher of the Year Ten Years Continuous Service Twenty Years Continuous Service The highest incentive at this distribution for faculty members below the rank of Professor was: the lowest was: This quarter each unit was worth: $_ In addition to the above unit values, you have received credit for the amount of $. which represents one percent of all your clinical billing for the quarter. In addition you received:$ for nights of first call in the quarter. Please remember that the unit totals are recalculated on a semiannual basis and that the number of units you received in each category can change every six months.THE ROBERT WOOD JOHNSON MEDICAL SCHOOL Exhibit 5. Department Incentive Units Awarded # of 1st # of and Academic Admin. Billing Bonds 1% of Calls Calls Amt. of Physicians Rank Position Position Total Unit Billing * $150 * $75 Incentive 6 14 $1134337 $101938 $12.362.75 25 45 3.646.08 1.935.15 1200.00 600 7.381.23 FEE 7.33 5.90907 960.69 1050.00 525 8.414.76 10 8,102.41 1,905.11 1200100 600 11,807.52 12 9.722.89 1,14354 10.866.43 N -A 7 5.671.69 1,754.97 7.426.66 6 4.861.45 1.675.09 6.536.54 433 8.33 6.74931 1.635.72 1200.00 600 10,185.08 3240.96 126753 1200100 600 6,308.49 3240.96 1,180.41 750.00 375 5.546.37 5.671.69 2,196.91 1350.00 675 9.893.60 233 6.33 5.128.83 1.62803 750.00 375 7.881.86 6 4.861.45 1283.83 1200100 600 7.915.28 2 6.481.93 1.930.84 900.00 450 9.762.77 3.6 2.4 4861 45 1317.83 1050100 7,754.28 4.861 45 664.79 300.00 150 5.976.24 NN 17 4.861.45 1.428.26 1200.00 600 8.089.71 $144,169.52THE ROBERT WOOD JOHNSON MEDICAL SCHOOL Exhibit 6. Relationship Between MSRP and Clinical Departments MSRP Clinical Departments Membership Required of all faculty Billing Bills and collects all Receives credit for fees of patient care fees faculty in clinical practice account. Fee Schedule Each faculty member or department (anesthesia) sets own fees. Operating Costs Share based on annual budget. 15% ceiling of MSRP on all fees for service income; 5% ceiling on all professional service con tracts. Dean's Tax 8 1/2 % of net billing after deduction of operating costs of MSRP Contingency Fund 1/2 % of net billing after deduction of for emergencies in operating costs of MSRP. faculty practice) Deferred Compensation Trust may be established and payments made into it. Annual Faculty Compensation Negotiated annually with chair (including bonus) If Deficit in Year T Shared among remaining clinical practice accounts in Year T. Repaid in Year T+1 to clinical practice accounts that covered deficit in Year T.THE ROBERT WOOD JOHNSON MEDICAL SCHOOL Exhibit 7. Faculty Practice Service Plan Financial Position Report for Department of Anesthesiology Most Recent Fiscal Year Supplements Fees Total Fees Admin. Deficit & Fringe Operating M.D. Collected Contract Collected Expense Dean Reduction Benefits Expenses Overage I (C) $15.831 $250.201 $266.032 $23.656 $19.390 $5.321 $110.766 $30.836 $76063 2(C) 236.559 236.559 21,469 17 207 4,731 197.981 27.420 (32 249) 3(C) 300.093 47.393 347.486 29,700 25.423 6,950 113.992 40.278 131,143 4 (L) 3.917 (313) 158.918 0 (162523) S(C) 203.068 28.448 231.516 21,095 16.834 4.630 115.446 26.835 46.676 6 (L) 1 522 1.522 113 113 176 1090 7 (L) 40 40 28 8 (C) 394,789 42.354 437,143 36.353 32 063 8.743 117.099 50.670 192 215 9 (L) 18 8 14 14 22 134 10 ( L) 3.268 3.268 242 242 379 2340 11(9 296.21 1 14.808 311.019 26.994 22.722 5220 146.661 36051 72371 12 (9) 347.978 53570 401 548 33.712 29.427 81031 140,730 46.566 143082 13 (9) 555.673 19.928 575.601 46.626 42,318 11512 126.395 66,719 282031 14 (9) 12.342 12.342 916 914 247 1,431 B.834 15 ( L) 25 0 25 2 2 17 16(9) 377.672 47 526 425.198 35.466 31.179 8504 123.838 49285 176.926 17 (L) 125 125 14 90 18 (L) (1 382) (1,382) (103) (102) (28) (160) (989) 19 (0) 124.882 24.321 149,203 11071 11051 2.984 93.740 17 294 13063 20 (9) 10.396 (10396) 21 (9) 202.608 30 044 252.672 22.665 18401 5053 136.691 29288 40 574 22 (L) 78.456 13.300 91 .756 10.725 6.482 1.835 29.066 10.636 ZIOEE 23(9 372,458 31 226 408.684 33.870 29 585 8074 61,866 46.792 223.497 24 (9) 419.137 56.833 475,970 39 234 34.939 9519 114,785 55.170 222.323 25 (L) 8.163 8, 163 606 605 163 916 5.843 26 (C) 40,875 (40 875) 27 (L) (1.258) 1258 28 (9) 202,966 37.662 240,628 21,771 17509 4.813 166.027 27,892 2.616 29 (R) 393.61 1 41.481 435.092 36,201 31.911 8.702 121,790 50.432 186056 30 (9) 226.360 49.647 276.007 24,397 20.129 5.520 87,464 31,992 106505 31 (R) 338,282 36.826 375,108 31,750 27 469 7502 133.518 43.479 131 390 32 (L) 12.484 12.484 926 925 250 1.447 8.936 3 (L) 2,102 2,102 156 156 42 214 1504 34 (9) 329.065 45012 374,067 31.673 27.392 7481 1 10.295 43.359 153.867 35 (M) 0 (3,785) (3,785) (418) (365) (76) 0 (439) (2487) 36 (9) 680 680 50 50 14 79 487 Totals $5,475,266 $866,795 $6,342,061 $544861 $463684 $126841 $2457081 $735141 $2014453 (C) = Current Department Member (L) = Left Department Some Time Ago (R) = Recently Left DepartmentCurrent Incentives -Charge less base fees and less quarter hours worked -1hr weekly spent on mandatory case conferences -le. 3 cases per day (3 base fees) -$120,000 base salary -Salary increases of 10% each year for 3 years -Once board certified, 20% salary increase -Schedule flexibility -$4,000 in medical malpractice insurance -Collection costs averaged approximately 10% of gross billings -Each anesthesiologist pays appropriate % of department's pooled office equipment, salaries of chair and other doctors who were primarily doing research, entire department infrastructure, as well as techs, secretaries, and administrators -Also taxed to pay at least /s of residents salaries -Recent completion of residency program yields annual bonus of $8000-$14,000 -Bonus pool for each worker of $40,000-$70,000 quarterly divided between faculty -total number of units earned by all faculty in any particular quarter divided into total funds available -Then an individual's total unit count is multiplied by the unit value to determine his or her share of funds -Penalties for poor billing practices reduces individual's total units -In addition to the unit incentive plan,-added an amount equal to one % of each individual's clinical billing per quarter -also adding 5% of all grant money brought in by an investigator to be paid over the life of the grant -First person on call during the preceding quarter received $150 per call night -Back up call receives $75 per night Working past 6:00pm (when not on call) pays $100 per hour -Sunlighting during vacation days, $800 per day -Incentives paid in last quarter of year. [5 points] Calculate the current incentives available to a physician against other ways for a physician to improve their compensation. Given the current plan from Dr. Klein. describe other incentive options that he might want to consider. What would those do to the commitment to research and teaching