Emergency Physician Overhead

Revised and approved by the ACEP Board of Directors
September 1992
June 1997
June 2009 

Reaffirmed by the ACEP Board of Directors June 2002 

Emergency physicians in nonoffice-based settings bear significant overhead expenses. Consistent with this concept, the Centers for Medicare and Medicaid Services (CMS), has calculated that this overhead rate is 46% exclusive of bad debt, Medicare and Medicaid write-offs, HMO and PPO discounts, charity care, and professional courtesy. Overhead expenses include, but are not limited to the following.

• Uncompensated care including that resulting from EMTALA mandates.
• Professional medical liability insurance premiums.
• Administrative expenses including but not limited to coding, billing and collection expenses, legal and accounting service expenses.
• Physician management services including medical director duties, quality improvement, EMS director duties, medical staff services, and community relations.
• Personnel or payroll expenses including fringe benefits.
• Documentation expenses including transcription costs, training, and supplies.
• Adoption and implementation of electronic medical record systems to improve patient care.
• Medical equipment, materials, and supplies including depreciation.
• Office expenses including rent or mortgage expenses for office space, utilities, telephone, information services, technical support expenses.
• Recruitment expenses including travel, moving costs, and training.
• Other professional books and journals, continuing medical education expenses, and licenses.
• Availability expenses. The emergency department must be fully staffed and operational 24 hours-a-day, 7 days-a-week whether any patients are present or not. Unlike other specialists that can be "on call," the emergency physician must be physically present and ready to provide care at all times. This unique practice expense requires significant costs which cannot be allocated to a particular patient.
• Costs associated with the preparation for and participation in planning for regional and national disasters, including travel and lodging, vaccine/immunization updates, shift coverage, community support, and adherence to federal/state mandates.
• Expenses related to the support and adherence to mandated performance and quality measures required by hospital and regulatory agencies and third party payers.
• Expenses related to compliance with hospital mandated patient satisfaction initiatives.
• Administrative costs required for adherence to patient privacy regulations.