RVUs Aren’t Always What They Seem: Understanding Blended Units in Physician Compensation

Relative Value Units (RVUs) are the backbone of physician compensation in many specialties. On paper, the system looks simple: a physician produces work, that work generates RVUs, and RVUs translate into pay through a conversion factor. It seems like a clean productivity metric that rewards effort, efficiency, and clinical volume.

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But if you have ever compared your paycheck to your colleagues' across different specialties, hospitals, or practice types, you know it’s rarely that straightforward. RVUs can be blended with other credits or income streams. Sometimes this blending is used to recognize work that does not directly generate billable RVUs. Other times, it’s used to make a job offer more appealing in recruitment or to even out inequities caused by payer mix. The result is that the same number of RVUs can represent very different realities.

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RVUs 101: A Quick Refresher

RVUs have three components:

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• wRVUs (work RVUs): The physician effort, including skill, time, and intensity of service.
  
• peRVUs (practice expense RVUs): The overhead required to deliver care, such as staff, equipment, and supplies.
  
• mRVUs (malpractice RVUs): The portion that covers malpractice costs.

In most physician contracts, it’s the wRVUs that matter. Employers assign a dollar conversion factor, for example $50 per wRVU, and compensation scales with productivity. This is a tidy system, but it leaves out a great deal of what physicians actually do.

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What’s In A Blended Unit? 

Blended RVUs are becoming more common as employers look for ways to capture the full scope of physician work.  The goal is to smooth out the edges and ensure physicians are rewarded for their non-clinical work and, at the same time, not penalized for seeing patients covered by lower-reimbursing payer groups like Medicare and Medicaid. 

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Non-Clinical Responsibilities

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A pure wRVU count only reflects billable encounters. Yet physicians spend their time taking on a broad set of additional responsibilities - they take call, supervise trainees, serve on committees, teach, conduct research, and take on leadership roles. Blended units give employers a way to assign credit to these responsibilities so they are compensated alongside clinical productivity. 

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In practice, this can take several forms. Call coverage may be converted into assigned-credit RVUs, so a night in the hospital has measurable value. Teaching and research may be given RVU equivalents in academic settings. Leadership and administrative duties are often credited as blended RVUs as well. In shift-based work, some hospitals award credit for 12- or 24-hour shifts regardless of the number of billable encounters. Even quality metrics, such as patient satisfaction or readmission rates, may translate into blended RVU credit. In some contracts, the RVU conversion factor itself is adjusted. For example, instead of $50 per wRVU, an agreement may say $60 per blended unit to reflect these additional responsibilities.

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Payer Mix and Ownership

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Blending is also used to balance payer differences. Rather than tying compensation strictly to Medicare’s RVU scale, some groups calculate an average across commercial, Medicare, and Medicaid reimbursements. This approach helps ensure physicians are not penalized for treating a higher proportion of patients covered by Medicare and Medicaid.

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Ownership can add yet another layer. A stake in an ambulatory surgery center (ASC), for example, entitles physicians to a share of facility fees like OR use, supplies, and staffing. These distributions are technically investment income, not RVUs. Still, some private groups fold them into a “blended per-RVU rate.” A surgeon may earn $50 per RVU clinically, but with ASC income included, the group may market it as $70 per RVU. This shorthand makes comparisons simpler, but it is not true RVU math.

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The Pros and Cons of Blended Units 

Blending RVUs may just seem like an accounting trick - it solves real problems in physician pay. Without getting credited RVUs, physicians who take frequent call, lead programs within their organizations, or teach trainees would earn less than peers who are focused only on billable encounters. In safety-net settings, blending also protects physicians from being financially penalized for seeing patients with lower-paying insurance.

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At the same time, blending can blur transparency. Two physicians may both report earning $70 per RVU; one through clinical productivity alone, the other with call stipends or ownership payouts folded in. Without knowing what’s included, the headline number can be misleading.

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‍What Physicians Should Ask

When reviewing or renegotiating a contract, do not stop at the per-RVU headline. Ask whether the model is based on straight RVUs or blended units. If it is blended, clarify what activities are credited. Call, teaching, leadership, and quality measures may all be included. Ask how ownership distributions are reported. Are they treated as investment income or rolled into an effective RVU rate? Finally, find out if the conversion factor is static or adjusted annually for payer mix and collections. These questions help clarify your true earning potential and whether your RVUs mean the same thing as your colleagues across town.

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Bottom Line

RVUs are a common foundation for physician compensation, but they are not as standardized as they appear. Between blended credits, payer mix adjustments, and ownership distributions, the number in your contract may not be directly comparable to someone else’s. In some cases, this works to physicians’ advantage, since blending recognizes non-billable work that keeps practices and hospitals running. In other cases, it adds confusion, especially when groups use “blended RVU rates” as a marketing tool.

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Understanding how blended units work and asking the right questions when reviewing a contract is the best way to know if you are being paid fairly for the full scope of your work.