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Hospital Circular 2/2005

Date Issued: 4 March 2005
Distribution: Public Hospitals

Attention: Public Hospitals, Extended Care Centres, Metropolitan Health Services, and Regional Offices

Subject: Hospital Payment Arrangements for Hospital Medical Officers on Rotation

There are two main methods of salary payment used by public hospitals to pay hospital medical officers on rotation to other hospitals. Payment method 1, the Invoicing Model , is where the doctor on rotation is paid by the parent hospital irrespective of where they are employed. Payment method 2, the Payroll Model, is where the doctor on rotation is paid by the hospital to which they have been rotated (the rotating hospital).

The purpose of this circular is to clarify the administrative responsibilities of the parent hospital under each of these arrangements and to clarify:

• the overheads that apply,
• the application of these overheads for invoicing,
• the rates for each overhead and
• to identify the salary components (as defined in the payroll) applicable to each overhead.

Administrative Arrangements

The parent hospital will invoice the rotating hospital within 7 days of an applicable pay period and that the rotating hospital will reimburse within 14 days of invoice. An electronic version of the invoice will be provided with sufficient detail to post to each payment type in the chart of accounts. The invoice should as a minimum contain the information contained in Attachment 1

The salary components (wage types) to which the overhead calculation is applicable are marked “Y” and are listed in Attachment 2.

* The annual leave percentage is the equivalent of 5 weeks leave recovered over 47 weeks of productive time.

** The workcover rate included in the overhead charge is the workcover rate of the hospital where the remuneration is recorded and reported to the Victorian Workcover Authority.

Recruitment and Management Charges

A recruitment and management charge of either 3% (Invoicing Model) or 1% (Payroll Model) is payable and based on the invoiced amount (invoicing model), on the average pay rate of the actual classification of the junior doctors for <10 doctors, or where >10 doctors on the following pay rates - MP4 (interns), MP5 (junior residents), MP1 (senior residents), MP9 (registrars).

The effective date of this circular is 1 January 2005.

Shane Solomon
Executive Director
Metropolitan Health and Aged Care Services

Attachment 1 Recovery of Annual Leave (MS Word File 32KB)

Attachment 2 Applicable Overheads by Wage Type (MS Word File 104KB)