SUPPLEMENTARY INFORMATION:

Under 38 U.S.C. 7431(e)(1)(A), not less often than once every 2 years, the Secretary must prescribe for Department-wide applicability the minimum and maximum amounts of annual pay that may be paid to VHA physicians, dentists and podiatrists. 38 U.S.C. 7431(e)(1)(B) allows the Secretary to prescribe separate minimum and maximum amounts of annual pay for a specialty or assignment. Pursuant to 38 U.S.C. 7431(e)(1)(C), amounts prescribed under section 7431(e) shall be published in the Federal Register and shall not take effect until at least 60 days after the date of publication.

In addition, under 38 U.S.C. 7431(e)(4), the total amount of compensation paid to a physician, dentist or podiatrist under title 38 of the United States Code cannot exceed, in any year, the amount of annual compensation (excluding expenses) of the President. For the purposes of section 7431(e)(4), “the total amount of compensation” includes base pay, market pay, performance pay, and fee basis earnings, but excludes recruitment, relocation, retention incentives,^[1] awards for performance and special contributions from total compensation calculations.

Background

The “Department of Veterans Affairs Health Care Personnel Enhancement Act of 2004” (Pub. L. 108-445) was signed by the President on December 3, 2004. ( printed page 77672) The law's major provisions established a new pay system for VHA physicians and dentists consisting of base pay, market pay and performance pay. These three components create a system of pay that is driven by both market indicators and employee performance, while recognizing employee tenure in VHA. While the base pay component is set by statute, market pay is intended to reflect the recruitment and retention needs for the specialty or assignment of a particular physician or dentist at a facility. Further, performance pay is intended to recognize the achievement of specific goals and performance objectives prescribed annually.

On April 8, 2019, the President signed Public Law 116-12, which amended 38 U.S.C. 7431 to include podiatrists within the physician and dentist pay system, authorizing podiatrists to receive base pay, market pay and performance pay. With the amendment, podiatrists are also subject to the same limitations and requirements as physicians and dentists under section 7431.

VA will consolidate pay table 1 and 2, resulting in the elimination of a pay table. Changes to the minimum and maximum amounts for the revised pay tables 1 and 2 have been made. The maximum amount for the former pay table 3 (now pay table 2) remains unchanged since the 2016 publication in the Federal Register . Pay tables 1 and 2 will cover the clinical specialties, with pay tables 3 and 4 covering the executive assignments.

Discussion

VA identified and utilized salary survey data sources which most closely represent VA comparability in the areas of practice setting, employment environment and hospital/health care systems. The Association of American Medical Colleges, Sullivan Cotter and Associates, Medical Group Management Association, Korn Ferry Healthcare National and Executive Report, Mercer Integrated Health Networks and the Survey of Dental Practice published by the American Dental Association were collectively utilized as benchmarks to prescribe annual pay ranges across the scope of assignments/specialties within the Department. While aggregating the data, a preponderance of weight was given to those surveys which most directly resembled the environment of the Department.

VA continued the practice of grouping specialties into consolidated pay ranges to accommodate the more than 40 specialties that currently exist in the VA system. This allows VA to use multiple salary survey data sources to minimize disparities and aberrations that may surface from data involving smaller samples that change from year to year. Aggregating multiple survey sources into like groupings results in greater confidence that the average compensation reported is truly representative. The aggregation of data provides for a large enough sample size to provide maximum flexibility for pay setting for VHA physicians, dentists and podiatrists.

In developing the annual pay ranges, distinctive principles were factored into the compensation analysis of the data. The first principle is to ensure that the minimum and maximum salaries are at a level that accommodates special employment situations from fellowships and medical research career development awards to Nobel Laureates; high-cost areas; and internationally renowned clinicians. The second principle provides ranges large enough to accommodate career progression, geographic differences, sub-specialization and other special factors.

Clinical specialties were reviewed against available, relevant private sector data. The specialties are grouped into two (formerly three) clinical pay ranges that reflect comparable complexity in salary, recruitment and retention considerations. The Steering Committee recommendations included consolidating the former pay tables 1 and 2, designating two clinical pay ranges (pay tables 1 and 2) for the varying clinical specialties and designating pay tables 3 and 4 for executive assignments. The Steering Committee also made recommendations to add new and realign existing specialties to different clinical pay ranges, as well as changes to the minimum and maximum pay ranges.

Signing Authority

Denis McDonough, Secretary of Veterans Affairs, approved and signed this document on October 24, 2023, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs.