Practical Provider Group
Contract Clarity Workshop — Free Resource
Compensation Structure Comparison
RVU vs. Salary vs. Productivity — what each means for your actual paycheck.
Your offer letter may quote an attractive number that doesn't reflect what you'll actually earn. The compensation structure determines your real income — and most providers don't understand the differences until they're living them.
Pure Base Salary
Fixed Income Model
You are paid a fixed annual salary regardless of how many patients you see or how much revenue you generate. Common in health systems, community mental health, and FQHCs.
- Predictable income — same every paycheck
- No pressure to overload your schedule
- Protects you in slow periods or when building a panel
- Simpler to evaluate and compare offers
Advantages
- No upside — working harder doesn't pay more
- May come with strict productivity expectations anyway
- Typically lower ceiling than productivity models
Disadvantages
$130,000/year base salary. You see 20 patients per day. You earn the same whether you see 15 or 25.
New graduates, providers prioritizing stability, community mental health settings
RVU-Based (wRVU)
Work Relative Value Unit Model
You are paid based on the number of work Relative Value Units (wRVUs) you generate. CMS assigns an RVU value to each CPT code — a 99214 is worth more than a 99213. Your employer multiplies your total wRVUs by a dollar conversion factor (e.g., $45–$55/wRVU for NPs). Common in large health systems.
- Direct reward for productivity
- Transparent — you can calculate your income from your schedule
- Higher earning potential than pure salary
Advantages
- Complex — requires understanding CPT coding and RVU values
- Income varies — lower in slow periods
- May incentivize shorter, less complex visits
- Lower wRVU rates for NPs vs. physicians is common and negotiable
Disadvantages
You generate 4,500 wRVUs in a year at $48/wRVU = $216,000 gross. After a base draw of $130,000, you receive $86,000 in additional productivity pay.
Experienced providers, high-volume practices, providers who understand coding
Hybrid / Productivity Bonus
Base + Bonus Model
A guaranteed base salary plus a bonus for exceeding a productivity threshold. The most common model in private practice and mid-size group practices. The devil is in the details of how the threshold is set and what percentage of excess revenue you receive.
- Income floor protects you — especially year one
- Upside potential for strong performers
- Most common model — easier to benchmark
Advantages
- Threshold may be set so high you never reach bonus
- Bonus percentage of collections may be low
- Complex to compare across employers
Disadvantages
Base salary of $120,000 + 25% of collections above $400,000. If you generate $500,000 in collections, you receive $120,000 + $25,000 = $145,000.
Most providers — negotiate the threshold and percentage carefully
Collections Split (Percentage of Collections)
Revenue Share Model
You receive a percentage of what the practice actually collects from billing — typically 35–50% for NPs, sometimes expressed as 60/40 or 70/30 (practice/provider). This is different from productivity/RVU because it's based on cash collected, not work generated. A $200 visit billed may only collect $110 after insurance adjustments — your split is based on the $110.
- Simple math — easy to calculate your expected income
- Directly tied to revenue you generate
- Common in private practice settings
- Can be lucrative in high-volume or cash-pay practices
Advantages
- Income affected by insurance adjustments, denials, and slow payers
- No income floor — slow months hit hard
- Split percentage varies widely — 35% and 50% are both common
- You may not have visibility into what's actually being collected
Disadvantages
Practice collects $12,000 in a month from your patients on a 40/60 split (you/practice). You earn $4,800 that month. If collections are slow due to insurance delays, your check reflects that even if you saw the same patients.
Private practices, cash-pay or concierge settings — negotiate the split percentage and ask for a collections report
The Contract Clarity Workshop walks through all four models in detail, including how to calculate your real expected income from any offer and what to negotiate in each structure.