Learn how facility totals benchmarks could help your organization answer questions like:
• How many call coverage positions do other trauma centers pay?
• How much do hospitals of similar size pay for medical directorships?
• Are we paying more medical directors than other hospitals?
• ...And more!
4. Our vision
• https://vimeo.com/473179351 costs
Cost is the largest issue facing healthcare
organizations
✔ Providers face enormous pressure to bend
the cost curve
✔ Physician-related expenses cost
organizations millions of dollars a year, but
you can’t manage what you don’t measure
✔ If you aren’t leveraging technology within
the physician contracting and compensation
process, you leave your organization
vulnerable to compliance risks and
overspending
6. INSTANT MARKET RATE COMPARISONS &
DOCUMENTATION
NO BLACK-BOX
ALGORITHMS
EXPERT SUPPORT AND
ANALYSIS
COMPREHENSIVE TECHNOLOGY
AUDITING AND MONITORING
TOOLS
FACILITY-WIDE BENCHMARKS
Why MD Ranger?
WE’RE DIFFERENT. HERE’S HOW.
MORE BENCHMARKS; LARGER
SAMPLE SIZES
CONTRACT NEGOTIATION
TOOLS
7. Benchmarks: adding value
1. Understand the market for physician services
2. Establish appropriate physician payments
relevant to your organization
3. Measure performance to certain standards
4. Compare costs across your organization
8. Our vision
• Policies and procedures to streamline
physician compensation
• All your physician compensation
benchmarking needs in one place
• Simple look-ups with trusted data
• Single source to facilitate consistent
methodology and data to apply throughout
your organization
• Repository of contracts and comparison
tools to enable budgeting, negotiating and
analyzing physician costs
About facility totals benchmarks
• MD Ranger calculates a facility’s total non-salary estimated
physician spend using aggregated subscriber data
• The benchmarks are calculated from call coverage, medical
direction, other administrative positions and hospital-based
contracts
• The benchmarks do not include collection guarantees (when
we don’t have enough information to know net payments) and
positions with no net annual payment data, hence they provide
a conservative estimate of total facility physician expenses
9. Overall spend benchmarks
• While benchmarking on a contract
by contract level basis is
straightforward, benchmarking
your organization on overall
spend is more nuanced but
equally important
• Using facility-wide benchmarks
can help a hospital or health
system identify opportunities to
reduce costs, address or
document outliers, or revise
payment policies
Facility total benchmarks give a helpful
perspective on physician payment
practices and costs
10. Unprecedented insightFacility total benchmarks shed light on the scope and type of payments
made by hospitals with different characteristics such as size and trauma
status.
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
Median Total Physician Spend by Facility Characteristic
11. Our vision
• Policies and procedures to streamline
physician compensation
• All your physician compensation
benchmarking needs in one place
• Simple look-ups with trusted data
• Single source to facilitate consistent
methodology and data to apply throughout
your organization
• Repository of contracts and comparison
tools to enable budgeting, negotiating and
analyzing physician costs
Factors influencing payments
• Trauma Status
• Facility size
• Payor Mix
• Number of facilities being covered
• Type of market
14. Our vision
• Policies and procedures to streamline
physician compensation
• All your physician compensation
benchmarking needs in one place
• Simple look-ups with trusted data
• Single source to facilitate consistent
methodology and data to apply throughout
your organization
• Repository of contracts and comparison
tools to enable budgeting, negotiating and
analyzing physician costs
Hospital-based spending over time
Hospital-based service spending is on the rise
Hospitalist programs in particular continue to expand their
footprint as these types of programs proliferate. We have
seen growth in specialist hospitalist programs in
particular, such as laborists, neurointensivists, orthopedic
hospitalists, and psychiatric hospitalists
Frequency of 24/7 coverage for these programs has also
increased, at additional cost
16. ED call spend distribution
• Despite increases in hospitalist
services, call coverage spending
has remained relatively steady
(and significant) for facilities in
the MD Ranger database over
time
• The average hospital spends
around $3.5 a year on ED call
coverage arrangements alone.
• Typical payments are on a per
diem basis
19. Our vision
• Policies and procedures to streamline
physician compensation
• All your physician compensation
benchmarking needs in one place
• Simple look-ups with trusted data
• Single source to facilitate consistent
methodology and data to apply throughout
your organization
• Repository of contracts and comparison
tools to enable budgeting, negotiating and
analyzing physician costs
Direction and administrative total spending
trends: 2016-2020
• Hourly rates have remained virtually unchanged
• Annual rates are up slightly
• While types of administrative positions and roles have
increased over the years, fewer physicians are performing the
work
• Each contract is ending up with more hours leading to higher
annual rates for the doctors and lower annual rates for facilities
25. Drive performance
USE MD RANGER BECNHMARKS FOR STRATEGIC DECISION-MAKING
AUDIT/
MONITOR
BUDGET
& PLAN
OVERALL
TRENDS
▪ Use benchmarks to budget for
new positions, recruitment
agreements, PSAs,
employment arrangements,
and compensation planning
▪ Understand time commitment
ranges for 100+
administrative/director
positions for planning and
resource allocation
▪ For AMCs: make funds-flow
decisions and negotiate rates
for outreach services and
partnerships
▪ Provide annual physician
compensation and productivity
reviews and analysis
▪ Perform quarterly or annual
compliance audits
▪ Monitor arrangements and
identify risky contracts for
compliance
▪ View spending by facility and
service; drill down by type of
arrangement, specialty, or
program
▪ Understand your
organization’s overall
investment in physician
contracts
▪ Compare total spending to
benchmarks
26. Our vision
• Policies and procedures to streamline
physician compensation
• All your physician compensation
benchmarking needs in one place
• Simple look-ups with trusted data
• Single source to facilitate consistent
methodology and data to apply throughout
your organization
• Repository of contracts and comparison
tools to enable budgeting, negotiating and
analyzing physician costs
Summary of key findings
• Factors influencing total facility spend include facility size and trauma
status
• Hospital-based services are the fastest growing category of spending
• ED call coverage total spending has remained relatively stable over time
but is influenced by factors like facility size, ADC, and trauma status
• From 2016-2020, hospital spend for medical directors has decreased
slightly, while the average number of paid services has increased. This
could be due to consolidating administrative roles.
• Median number of paid hours per position in medical director contracts
increased over the past 10 years, meaning directors and administrators
are putting in more time.
• Hourly rates have been steady, but the increase in hours has meant an
increase in the average payment per contract.
27. How to use these benchmarks
Compare your facility based on key
characteristics
Analyze facilities within a system: identify
outliers and opportunities for
standardization
Understand total payments for types of
services within a facility and across a
system of facilities
28. Using MD Ranger analytics: by facility and type
Compare your spending to Facility
Totals Benchmarks
30. Our vision
• Policies and procedures to streamline
physician compensation
• All your physician compensation
benchmarking needs in one place
• Simple look-ups with trusted data
• Single source to facilitate consistent
methodology and data to apply throughout
your organization
• Repository of contracts and comparison
tools to enable budgeting, negotiating and
analyzing physician costs
How Sycamore Health* uses Facility Totals
Benchmarks
• Level II trauma center CEO concerned about
total dollars spent on ED coverage
arrangements and hospital-based agreements
• Listens to MD Ranger’s Total Facility
Benchmarks webinar; looks at his facility’s MD
Ranger’s Analytics Dashboard
• Compares his facility to other trauma center
spend using benchmarks
• Determines his facility is well within an
acceptable range; focuses his time and effort on
high-value on hospital-based arrangements like
orthopedic hospitalists
*Pseudonym
31. Let’s talk
⁃ Do you need to streamline physician
compensation and FMV documentation
processes?
⁃ Do you need one comprehensive source for
decision support and compliance?
⁃ Do you need a consistent process to identify risky
contracts or monitor your physician spend?
⁃ Reach out: email info@mdranger.com or call our
office at 650-692-8873
Editor's Notes
Hello Everyone! Thank you for joining us today! My name is Lauren Slaven and joining me today is my colleague Jeremy Goldberg. We are here today to talk about MD Ranger’s facility totals benchmarks. Before we begin, I want to let you know that we will be recording the session and we will distribute the recording to attendees in a few days. If you have any questions during the webinar, please submit those to my colleague Erik Bartlett via the chat box on go to webinar. If Erik can’t get to the questions during the webinar he or I will follow up shortly after.
LS-Here’s our agenda for the webinar today. First, we will provide a brief introduction to MD Ranger, then we will get into the benchmarks and provide some key takeaways. Before we start I would like to take a moment to introduce your hosts to you.
LS- My name is Lauren Slaven and I’m a senior sales executive here at MD Ranger. I have worked with healthcare organizations for about the last 9 years or so primarily in relation to contract management and contracting processes, policies and procedures. My hobbies include cooking and I have recently taken up playing the banjo. Joining me today is my colleague Jeremy Goldberg, Jeremy…..
J: Thank you Lauren. Hi, I am Jeremy Goldberg and I am the data specialist at MD Ranger. I work with our subscribers when they are submitting data as well as helping them use and understand the benchmarks we produce. Outside of work I have started playing disc golf as a social distance activity.
LS- Imagine if, at the end of the day the policies and procedures that dictate your physician compensation program are simple and easy all your needs are met within one solution you have a single source that has consistent and sound methodology and benchmarks.
The industry needs products that are easy to use and can help you across the multiple areas of physician compensation and contracting. Ideally our goal is to help you create day-to-day efficiencies so that you are then able to be strategic - focusing on important issues not managing consultants and summarizing contracts.
Imagine focusing on being in true alignment with your doctors.
That's really our vision for you as progressive health care organizations within today's complex environment.
LS- MD Ranger’s founders identified significant issues with physician contracting that contributed to out of control costs and were characterized by inefficient policies and processes. The company set out to create a product-based solution to meet organization’s physician contracting needs.
We aim to make physician compensation less complicated and more streamlined. These are our goals, and we meet them by marrying powerful surveys to easy-to-use technology features like easy look-ups and automated analytics. These features create a very powerful product that helps people like Maria resolve big cost challenges.
In addition to providing benchmarks that you are used to seeing in other surveys like compensation and call coverage. MD Ranger provides benchmarks for a broad range of services and metrics that include total hospital spending across all non-salary services.
Facility total benchmarks provide insight into the scope and type of payments made by hospitals with different characteristics such as size and trauma status. Benchmarks aren’t necessarily the end all be all but they are incredibly powerful, especially when used in the decision-making process at your organization. We translate the insights that we get from compensation benchmarks to an organization-wide context.
LS- When it comes to our benchmarks we have some key differences to our methodology and our data that are very important to share in the context of this webinar.
First, when it comes to sample size and reporting our benchmarks, we generally take a more conservative approach which creates stability in our benchmarks.
Also, instead of collecting data directly from doctors, we get our data from hospitals and healthcare organizations contracting with physicians for services.
it is not just high quality benchmarks, it is a comprehensive toolkit for everything from looking up rates to providing the reports and tools to be the foundation of a physician contract compliance process across an organization.
Now, because of the vast amount of data collected by MD Ranger, we are able to analyze total spending on physician contracts by MD Ranger subscribers. We will tell you more about this shortly!
LS- Now before we get into the facility totals themselves, I do want to spend a few minutes discussing why benchmarking is really good for your organization.
Using benchmarks for physician contracting on a contract by contract basis is an established best practice. Even if you are actually using a valuation consultant to document FMV for a payment rate, market data benchmarks are routinely used as part – if not the very basis - of that analysis.
Physician compensation benchmarks help us understand what the market is like for any particular physician service.
Benchmarks help you understand where on the market ranges you are paying at your organization and they can help you stay within organizational guidelines, to ensure consistent payment standards across services and facilities.
Benchmarks ultimately help you measure an organization's performance against a standard and help you understand how your organizations are performing in relation to other organizations.
LS- A total spending amount for each facility is computed by summing estimated values for all reported coverage, administration, and hospital-based physician contracts for which annualized payment rates are available. Taking each facility total as a single data point, a distribution of facility total spending is formed, and the percentile values are reported.
LS- On the other hand when we are talking about organization wide benchmarks… I’m finding that most healthcare organizations aren’t tapping into these insights.
Either organizations don’t know where to find facility benchmarks or they are focusing on the details of negotiating and documenting individual contracts so that they can’t really see the forest for the trees.
Ultimately facility wide benchmarks can help organizations identify cost reduction opportunities, determine if there are any services or service line areas that are outliers in terms of overall spend, or even revise payment policies that might not be serving the organization.
It’s always shocking to me when I ask organizations how much they are spending on physician contracting and they have no idea. To follow that I’ll ask how much they are spending on call coverage for instance, they may know how many services they are paying for or about how much they are paying for per diems but it’s typically vague. These should be numbers that are easily accessible to you, your leadership team and your board.
Jeremy is going to provide some additional insight into our facility totals benchmarks.
JG- Our data collection method provide insight into a number of benchmark characteristics and payment trends. We slice our data by various characteristics because we know each hospital is different and has unique needs. As we go through the benchmarks today, I will be focusing on the All Facilities slice but do remember that every facility is different. As you can see, the difference between a trauma center, and hospital size are big drivers of cost, so it’s important to benchmark against the right facilities.
JG- MD Ranger annually review how facility size affects physician compensation and as our database has grown we have been able to increase the number of facility size benchmark cuts available. Bed size benchmarks are available in three slices: under 100 beds, between 100 and 300 beds, and above 300 beds. Average daily census also has three slices: under 75, between 75 and 150, and above 150. These benchmarks enable more accurate peer comparisons.
Facility characteristics can dramatically alter the total annual payment medians for a given hospital. In addition to trauma status and hospital size (beds or ADC), MD Ranger data also shows splits in overall payments depending on Urban vs. Non-Urban location and depending on percent of medicare days - primarily used as a SURROGATE for payer mix.
One other important factor is how many facilities are being covered. While these benchmarks focus on single facilities, some arrangements we see are for multiple facilities.
JG- In general we have seen Total Facility physician spending rise over the past ten years. You can see here that there is a huge distribution among facilities from just a few million to more than 20 million dollars every year. Note that there is more than a three-fold difference between the 25th and 75th percentiles of annual payments. The average was $8,481,580. This is a significant amount of money for any facility. Some of our subscribers will take a look at this, realize they are under the median and breathe a sigh of relief. Others REALIZE THEY ARE SIGNIFICANTLY DIFFERENT FROM COMPARABLE HOSPITALS AND UNDERTAKE A MORE THOROUGH ANALYSIS.
JG- Hospital Based Stipends have become the biggest part of many hospitals spending. These are services that generally are exclusively provided at the hospital by contracted groups of physicians. Facilities spend an average of $4,621,980 on Hospital Based Stipends. While some of these services are still paid as call coverage and medical direction separately, we are seeing a shift to more of these being paid as a stipend to a group of physicians.
We believe the proliferation of hospitalist services--both general hospitalists and all the specialist hospitalists – are the biggest driver in the cost increases.
There's more and more hospitals adopting hospitalist programs and more types of programs. Good examples are psychiatric hospitalists, laborists and neurohospitalists, but also more peds hospitalists programs as well. There are also more in-house physicians for more hours daily.
2:14
JG- Hospital Based Stipends have become the biggest part of many hospitals spending. Facilities spend an average of $4,621,980 on Hospital Based Stipends.
Hospitalists continue to increase their span of practice within hospitals, so contracts are larger – plus frequency of 24/7 coverage has increased. In addition, specialty hospitalist programs such as laborists, neurointensivists, orthopedic hospitalists, psychiatric hospitalists, etc. have increased in frequency. In 2020, 77% of hospitals had a hospitalist program and 63% had some form of specialty hospitalist program. 40% had a laborist program.
JG- Our analysis has found that trauma designation is THE MOST significant factor in payment rates and total expenditures across almost all types of physician contracts. We have now been producing these facility total benchmarks for 5 years. We have seen a nearly 2 fold increase in Hospital Based Stipends at Trauma centers.
JG- Call coverage payments continue to rise, averaging $3,256,310 at a facility, with a wide range in payments. Trauma centers spend more than non-trauma centers. While this is no longer the biggest part of many facilities spend it is still a point of pain for many organizations.
JG- Payments vary significantly by type of facility, with trauma status and hospital size the most significant factor in total call coverage payments. While call coverage payments have not changed significantly at the facility level. This is still a huge pain point for many organizations.
JG- The number of paid coverage services has remained pretty stable each year and averaged 12 this year compared to 13 IN 2017??. This is a benchmark unique to MD Ranger that helps identify how your facility compares to similar hospitals. As with total payments, trauma centers have more panels on call. Also as a reminder this is looking at the number of distinct services or panels, not the number of doctors.
JG- While we have seen individual direction contracts increase in cost, the total spend for all directorships has been declining. This could be due to the aggregation of direction positions. In some cases, two people were previously doing something THAT could be done by just one. Or A MULTI-FACILITY POSITION HAS REPLACED MULTIPLE POSITIONS. While total spend has gone down for the facility, the individual physicians have actually been receiving more, and we have seen a trend in higher hours.
JG- Medical Direction and Administration Payments have been on the decline in recent years. Facilities average spending just $855,720 on administration and direction. While we have seen the number of hours increase on a individual contract level, the total spend has decreased. As I just discussed on the previous slide, much of this is due to a decrease in the number of administrative positions at each facility.
JG- in 2020, the average hospital paid for 23 directorships, a slight decline since 2017.
However, the number of annual hours per director has increased. We also have found that both hours and the number of medical directors increases with hospital size.
A notable exception to the decline in directorships is psychiatry, in which we have seen an increase in the number of paid psychiatry administrators across hospitals of all sizes around the country. This could be related to the increase in psychiatric hospitalist and outpatient behavioral health services we have observed over the past few years.
Medical Directorship payments remain a critical point of concern for health systems
Payments for medical directorships continue to be a major expense for hospitals across the country. Paying too much for such services and paying for services without sufficient evidence of the commercial reasonableness for such payments can be a compliance risk under the Stark and Anti-Kickback statutes. Comparing your facility’s total number and cost for medical direction and other administrative services on a periodic basis should become a routine component of your compliance program. Payment benchmarks such as those provided by MD Ranger can provide insight into how much and when to pay, providing important information for negotiating contracts, documenting compliance and identifying opportunities to reduce cost.
JG- Our holistic data collection also allows us to create other unique facility level benchmarks. We calculate the percent of Subscribers who report paying for a service broke down by payment type. This can be great in helping determine if it is commercially reasonable to be paying for a service., an important factor in FMV documentation but also important to know when you enter negotiations for a new position.
JG- We also provide benchmarks on the number of paid administrators by service. The services that most frequently have more than one director positions are cardiology, GI, neurology, cancer programs, psychiatry and urology.
JG- One question I get sometimes, is people wondering what is the most commonly paid service. This year, it was Emergency medicine. These are the most commonly paid services of any type, the precents shown here represent the percent of subscribers that report paying for these services. They could have call coverage, direction, or Hospital Based payments or any combination.
Unsurprisingly, many of these are Hospital Based Services and Laborists are included in OB/GYN-All Types.
Lauren, do you want to share additional information in relation to how total facility benchmarks can be used to create cost saving efficiencies?
LS- You can use MD Ranger to budget and plan and also utilize it for auditing and monitoring CONTRACT EXPENSES and you can also see those overall spending trends across your organization
LS-
The largest impact on spend is facility size and trauma status with hospital based services growing the fastest in relation to spend.
Call coverage is influenced by different factors such as facility size, trauma status and also ADC.
We have seen the spend for medical directors decrease slightly but the number of paid services has increased which may be attributed to the consolidation of roles.
We have seen hours per paid position increase which is attributed to the fact that directors and medical directors are putting in more time.
We have observed that increased focus on quality initiatives and regulatory requirements in relation to median number of hours per position has resulted in the increase of average payment per contract.
LS- Organizations and valuation consultants frequently use benchmarks to both set physician payments rates and to document fair market value. It’s rare to come across an organization that isn’t pulling market data survey numbers whenever they are filing away an agreement they have negotiated is indeed fair market value. The facility total benchmarks add another layer of analysis to your benchmarking and budgeting toolkit, helping to identify areas for risk management or opportunities to save money.
LS- Our Subscribers can use the MD Ranger Analytics tools to see and document their overall spend across the organization. We breakdown spend by facility, by spending type, and by service. All of these can be compared to our facility totals to ensure you are within fair market range.
LS- Our Subscribers can use the MD Ranger Analytics tools to see and document their overall spend. We breakdown spend by facility, by spending type, and by service. All of these can be compared to our facility totals to ensure you are within fair market range.
Jeremy is going to walk you through an example we have seen recently.
JG- Here is the story of how one of our subscribers uses our facility totals. The names are changed to protect their privacy. This person works at an urban Level II trauma center and is concerned about how much they spend on their non-employed physicians. They can compare their values with the MD Ranger benchmarks, both at the service and facility level, using the Analytics tools. After realizing their call coverage is well within range, they can focus their efforts on contracts that are CLEARLY OVER THEIR COMFORT ZONE. They can also identify service and payment differences between facilities, to further identify areas for review.
LS- So, if you think facility totals benchmarks would be helpful to your organization or if you would like to discuss further, here’s my contact information, give me a call or shoot me an email and we can touch base.