RVU compensation is simple in theory—pay = wRVUs × rate—but real contracts add floors, tiered rates, advances (draws), and year-end true-ups. This guide explains each piece with plain-English formulas and worked examples so you can forecast your take-home—and avoid surprises like clawbacks.
Key Terms (30-Second Primer)
| Term | Plain Definition | What to Watch |
|---|---|---|
| wRVU | “Work” RVU: physician effort/skill/time component of a CPT code. | Most comp plans pay per wRVU, not total RVU. |
| wRVU Rate | Dollars paid per wRVU (e.g., $60/wRVU). | May be tiered; check how often tiers reset. |
| Floor / Guarantee | Minimum pay, often for Year 1–2 or ramp-up periods. | Is it pure floor (no payback) or an advance (draw) subject to clawback? |
| Draw | Advance paid periodically (e.g., $25k/mo) then reconciled to production. | Negative true-ups can create clawbacks if production is below the draw. |
| True-Up | Year-end (or quarterly) reconciliation of advances vs earned production pay. | How often? Positive carry-forward? Negative clawback? |
Model 1 — Base + Per-wRVU
Classic structure: a fixed base plus production at a single wRVU rate (sometimes after a threshold).
Formula:
Example
- Base = $240,000
- Rate = $60 per wRVU
- Annual wRVUs = 5,000
Pay = $240,000 + (5,000 × $60) = $540,000
Variations: threshold (no pay until 4,000 wRVUs), or credit only above target.
Model 2 — Tiered Per-wRVU Rates
Higher productivity unlocks higher per-wRVU rates. Tiers can be monthly, quarterly, or annual.
| Tier | Range (Annual wRVUs) | Rate |
|---|---|---|
| Tier 1 | 0–4,500 | $55 |
| Tier 2 | 4,501–7,000 | $65 |
| Tier 3 | 7,001+ | $75 |
Accrual-by-tier (common):
If you produced 7,500 wRVUs: $247,500 + $162,500 + $37,500 = $447,500 (plus any base if applicable).
Ask: Do tiers reset monthly/quarterly/annually? Accrual-by-tier or “all-at-highest-tier” after you cross a band? (The latter pays more.)
Model 3 — Floor / Guarantee
Used for ramp-up. A pure floor is a minimum with no payback. A draw-style floor is an advance against future production and can be clawed back.
| Feature | Pure Floor | Draw-Style Floor |
|---|---|---|
| Minimum Income | Yes | Yes (as advance) |
| True-Up Required | Usually No | Yes |
| Clawback Risk | No | Possible if production low |
| Common in Year | Year 1 | Year 1–2 |
Model 4 — Draw & True-Up (with Clawback)
Each pay period you receive a draw (advance). At true-up, the group compares your earned production pay vs total draws. Overpayment can be recouped.
Monthly Example (simple rate):
- Draw = $25,000/month
- Rate = $60/wRVU
- Month’s wRVUs = 500 → Earned = 500 × $60 = $30,000
True-up for the month = $30,000 − $25,000 = $5,000 owed to you.
Annual Example (clawback risk):
- Draws paid: $25,000 × 12 = $300,000
- Total wRVUs: 4,200 at $60 → Earned = $252,000
Year-end true-up = $252,000 − $300,000 = −$48,000 (you owe $48,000 back if contract requires clawback).
Protect yourself: Ask for a cap on negative true-up, partial forgiveness in Year 1, or convert to a pure floor (no clawback).
Comparing Models (At a Glance)
| Model | Upside | Downside | Best For |
|---|---|---|---|
| Base + Flat Rate | Predictable; easy math | Less reward at high volumes | Balanced practices, stable volume |
| Tiered Rates | Rewards high productivity | Complex; depends on reset rules | High-volume specialists |
| Pure Floor | No clawback risk | May be time-limited; lower rate | New grads, new service lines |
| Draw + True-Up | Cash-flow support during ramp | Clawback risk if volume misses | Startups, rebuilds, locational moves |
Negotiation Checklist (Copy/Paste)
- wRVU Rate & Tiers: What’s the rate? Do tiers accrue by band or switch all units to the highest tier once crossed? How often do tiers reset?
- Floor vs Draw: Is the guarantee a true floor (no payback) or an advance (draw)? Spell out clawback rules.
- True-Up Frequency: Annual vs quarterly; final reconciliation timing when you depart.
- Negative Caps: Is clawback capped (e.g., one month of draw)? Any forgiveness in Year 1?
- What Counts as wRVU: PA/NP attribution, call coverage, admin time, quality bonuses.
- MPPR & Modifiers Policy: Are wRVUs credited fully when MPPR reduces payment? How are bilateral/multiple procedures handled?
- Rate Reviews: Does the rate adjust annually? Based on market surveys or fixed?
FAQ
Do floors hurt my upside?
Not necessarily. Many plans pay the higher of (floor) or (production). Just ensure there’s no hidden payback unless it’s explicitly a draw.
What if I start mid-year?
Ask how tiers are prorated and when the first true-up occurs. Request a partial floor or first-year forgiveness on negatives.
Can I model this monthly?
Yes—track monthly wRVUs and apply your plan’s rate/tier rules. Then compare to your paystub to spot gaps early.
Make the Math Automatic
RVU Tracker lets you set your rate, tiers, and any draw/true-up rules—then shows real-time progress toward your targets. See the impact of MPPR, bilateral rules, and documentation upgrades before payroll does.
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