Hourly vs. Per Diem

Hourly vs. Per Diem

Per Diem Dude

The Age-Old Transcription Payroll Question Revisited

By Elizabeth E. Sanders, CMT

It is an issue that has divided much of the medical transcription world for more than a decade–to pay transcriptionists on the basis of hours worked or work completed. The reasons why the arguments are volatile are not surprising. For everyone involved, the bottom line may be as cut and dried as financial existence or as deeply rooted as a feeling of self-worth and respect.

In an attempt to bring our readers a full picture of those who are affected on a daily basis by this issue, ADVANCE spoke with four professionals within the transcription field–two managers and two transcriptionists. One of each is involved in a per diem employment situation, and the other two work within a straight hourly rate structure.

Each offered, given a promise of complete confidentiality, her feelings on the subject. It is our hope that the comments of those interviewed will offer insight both to MTs selecting a potential employer and those in upper management involved in making decisions regarding current or future pay structuring among transcriptionists.


ANNE–a medical records department manager who oversees and is responsible for the budgeting process in the hospital’s transcription department. The hospital currently pays its 10 full-time equivalent (FTE) transcriptionists a per-report rate, which is supplemented for what is deemed to be an excessively long report (over three pages).

“This continues to be a tough issue for us. For hospital administration that sets the payment policy, the very existence of their department may be at stake. Profits are, after all, not merely a luxury but a necessity,” Anne said.

“Even managers who oversee transcriptionists in a not-for-profit institution must prove their efficiency and worthiness to remain an entity. That equation, no matter how it is muddied and muddled by the most complex budgeting process, will undoubtedly come back to labor cost vs. productivity sum.”

Anne continued, “The transcriptionists don’t really like being paid per piece for the most part; but let’s face it, they would really be unhappy if the department was downsized or eliminated altogether and our dictation was sent out. We’re all just trying to survive. I believe our current system allows that survival.”

But Anne also hinted at some sympathy to the transcriptionists’ plight. “I have argued to management that there are mitigating circumstances–excessive phone calls from physicians looking for their reports, the necessity to run to the floors or radiology to bring STAT reports, etc. We do as much as we can to allow our transcriptionists to transcribe, but they occasionally end up running here or there or doing other tasks that take up time and essentially, they are not paid for those duties.”


CORRINNE–a certified medical transcriptionist (CMT) at a Midwest service with multiple overflow and regular work clients. She is paid per line. The line rate depends on the previous quarter’s quality rating of her work along with a determination of the difficulty of the client’s material.

“I am happy with our current pay structure about 99 percent of the time,” Corrinne told ADVANCE. “I have a fairly quick speed of transcription, and this system rewards that. I am also a very hard worker, and I believe that is why I thrive in this type of environment.”

Corrinne said there have been times, however, when she felt pushed by the system. “Over the past five years, I have been sick a few times–not enough to use a sick day, but just not feeling up to speed. I hate it when I know my paycheck will suffer because I’m just not feeling great, but I do try to catch up and type some extra when I’m feeling better.

“The only other thing that bothers me is that I sometimes feel bad that I am not offered anything for my longevity. In this business, especially in the service end of transcription where the difficulty can get pretty high, employees come and go like crazy. I’m proud and happy that I’ve been with this company for so long, but nothing is offered for that. If someone comes in and types just as well, they get the same pay.”

Corrinne concluded, “Overall, though, I know I come out better in the long run. I’ve figured out what I get paid per hour, and when I average my good pay periods with my not-so-good ones, it still comes out to be more than what I would get if I was being paid hourly at most places I’ve investigated.”


REBECCA–the vice president of ancillary operations, which in-cludes medical records, in a small-town, 68-bed hospital. The hospital pays an hourly rate to transcriptionists but closely monitors the production of the transcriptionists in a log book system that tallies number of pages typed during hours clocked in. The page-per-hour rate is used, along with other criteria, at service evaluations to determine the possibility of increased hourly rate.

“I feel that we really have the best of both worlds here,” Rebecca stated. “We really looked closely at this in 1995 when we were determining the future of our four-person department. We do send some work out, and we really considered switching to an outsourcing environment. In the long run, however, we decided against it.”

Rebecca spoke of the long hours put in to determine a fair system for everyone. “On one hand, we had transcriptionists saying that they should get more pay if they did more work. But we had others that pointed out that they try harder to make sure their work is accurate and take advantage of learning opportunities. So which way do you go?

“We felt a per diem rate would be hard to swallow for those working here for a long period of time, and we do feel that our transcriptionists work hard–it wasn’t a question of motivation. We decided that our combination solution would keep the integrity of both systems.”


KATHERINE–an East-Coast transcriptionist paid at a straight per-hour rate at a general and specialty medical clinic. The practice has 27 physicians on staff, along with multiple other support services that are also dictated on the system. Katherine has been employed at the clinic for 13 years. She is not a CMT and has no plans to obtain her CMT credentials, although her employer would pay her a bonus of 25 cents per hour if she did so.

Katherine enjoys her current pay structure. “I’ve thought about switching to one of the services. Many of the employees here have done so, and they said I would make a lot more money if I did. But for me, I would feel less appreciated if they only paid me for what I produced. Whether that feeling is reasonable or not, that’s the way I see it.”

Katherine questioned why her field should be singled out for a per diem system. “They talked about it here once–switching to a per line thing or something like that–but I really spoke up against it. Do the radiology technologists get paid per X-ray? Do the registration clerks get paid a dollar for each person they register? Can you imagine phlebotomists being paid for each person they poked? No way.

“So why should transcriptionists be singled out and be paid only for what comes out of their fingers? I’ll never understand that way of thinking. When I’m here, I’m working hard, and if I’m not, I should be talked to or reprimanded. But I do other things besides type that help make my product a better one. I research; I look up words or medications; I call doctors to get an answer. Why shouldn’t that be counted, too?”

Katherine concluded, “What I’m saying is that a per-diem rate may be OK for some transcriptionists; maybe they can deal with it. But I don’t choose to be a part of that, and I hope my option to be paid hourly doesn’t disappear.”

Elizabeth E. Sanders is now writing full time for a daily newspaper in Fond du Lac, WI. She keeps abreast of the transcription field and issues facing transcription through ADVANCE, other publications and her many transcriptionist colleagues.

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