While not the biggest, a physician or health professional’s CME allowance and expenditure is a significant concern. Every couple of years, depending on what state you practice in, you are expected to participate in a certain number of CME credit hours to maintain your medical license. To do so, practitioners generally receive a CME allowance from their employer intended to facilitate that goal and support their development as a clinician.

There’s not only pressure to understand and meet requirements but to spend your CME allowance effectively every year. Here’s an overview of what your CME allowance is, how it works, and some ideas on how to use it.

What is a CME Allowance?

A CME allowance is an annually budgeted amount of CME money earmarked for completing CME activities. Most physicians and health practitioners are required to earn CME credits each year or every two years, and CME allowances help allay the cost of CME activities for the practitioner. The average CME allowance for physicians can be thousands of dollars annually.

The CME system was developed by important medical authorities to incentivize and standardize the learning and development of practitioners. CME allowances help both healthcare organizations and practitioners share the cost of CME as well as its benefits. Healthcare organizations support earning credit with CME allowances and practitioners invest put time into earning credit.

Receiving Value for your CME Allowance

The specific value of a CME allowance can differ based on the amount of the allowance and how it’s spent. CME activities can range in cost, credits earned, and specific benefits. Based on these factors, a CME allowance could mean more or less CME credits earned per activity completed.

Activity cost per hour can also change based on the credit provider. Just because a provider labels a CME activity “online CME,” doesn’t mean it’s worth the same number of credits as another provider’s online CME.

Be mindful of the total number of credits that can be earned, type of activity, accreditation status of the activity, and duration of the activity before deciding the best use of your CME allowance.

Spending Your CME Allowance

When well managed, your CME allowance can help you make significant strides toward your learning and credit earning goals. Spending CME money means identifying the types of activities you enjoy and those that provide the necessary number of credits from a wide variety of content formats. If you’re a physician or health professional who needs to earn AMA PRA Category 1 Credit™, here are several popular options:

• Live events including destination CME conferences
• Online CME including on-demand courses
• Subscription CME
• Point of care CME

The number of credits one can earn differs based on the activity but live CME, especially travel CME conferences, are popular in part because it’s a chance to earn a significant number of credits and take a vacation at the same time. Always consider the total cost of participating in a CME activity, including any potential expenses that won’t be covered by your allowance, before choosing your next CME activity.

CME Allowance Expiration Dates

It’s very important to know that CME allowances typically expire in a year’s time, usually at the end of each December. The exact expiration date can vary based on your organization’s CME policy and the end of each June is also a common expiration date. Unspent CME funds do not roll over into the following year, and cannot be accrued from year to year. Check with your organization for your precise CME allowance expiration date.

CME Allowance Reimbursement and Expenses

Employee reimbursement, including that for healthcare professionals, should be accurately reported and accounted for. Costs eligible for reimbursement can include:

• Registration fees or costs for courses.
• Travel expenses such as food, fuel, or flight tickets.
• Access to textbooks or subscriptions to medical journals.
• Lodging costs or accommodations-related expenses.

It is important to know your organization’s CME reimbursement policies in advance. Healthcare organizations have different rules regarding what constitutes a legitimate CME expense. For instance, you may choose to attend a CME conference and book your flight and hotel with a travel company instead of doing it yourself. Or your CME allowance policy may support staying in a hotel but not a luxury resort. Nail down these requirements (or negotiate them as a condition of employment) before you purchase CME activities and related necessities so you are not stuck with a surprise non-reimbursable expense.

How are CME Allowances Allocated?

CME allowances can be allocated in a number of different ways by your employer. In some cases, the amount may be included in your annual salary and distributed monthly as a part of your paycheck to be spent at your discretion. This is typical of many healthcare employment arrangements and provides substantial freedom and flexibility for earning CME credit.

In other cases, the practitioner may be asked to spend their own money upfront. Practitioners then submit a list of expenses and proof of CME activity participation to be reimbursed. Reimbursements can be expected to cover the total cost of the activity itself, and may also cover some activity related expenses like travel and food, but not always.

Lastly, employers may manage CME budgets for individual employees. Employee information and a financial allotment are connected to a record or account, with a deduction made every time an activity or associated cost is paid for.

With each of these arrangements, there may be tax implications and you should check your employer’s CME policies or speak to an HR representative to learn more.