Review key findings from our recently published 2018 Total Facility Benchmark Reports, as well as compare them to past years' reports to uncover trends in physician payments. This presentation covers: -How much hospitals spend on call coverage and medical directorships -Facility-wide physician contracting trends -How healthcare organizations use facility-wide benchmarks to drive better performance -And more!

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Key Findings from
Total Facility Benchmarks

2. 2
ALLISON PULLINS
Allison specializes physician contracting and
physician/hospital relationships. Allison has 12+
years of experience in healthcare and has been on
the leadership team at MD Ranger since 2012.
Your host

3. 3
• Framing the challenges
• Benchmarking your organization
• Key takeaways from MD
Ranger’s 2018 Facility Totals
benchmarks
• About Us
Today’s agenda

4. Costs soaring
• Expense that has been
largely ignored
• Huge impacts on
financial performance,
organizational
performance,
physician relationships
4

5. Total hospital spend over time
5
$0 $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 $9,000,000 $10,000,000
2016
2017
2018
Median Total Spend

6. Spending in California hospitals
6

7. Factors driving increased payments
Increased time demands of
physicians such as
• JAHCO requirements
• Technology and quality
initiatives
• Peer review
• Committee and meeting
attendance
• Board responsibilities
7

8. Factors driving increased payments
Growing divergence of
hospital-based medicine vs.
office-based medicine
8

9. Factors driving increased payments
Economic and market forces,
such as:
• lower reimbursements
• larger group practices with
productivity incentives
• more part-time and employed
physicians
• competing internal governance
demands
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10. Competing priorities for doctors
10
More physicians are reluctant
to take call, serve as medical
directors, or run for medical
staff office if it results in lower
revenue and fewer patients, or
if duties impinge on either
clinical or after-hours
activities.

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BENCHMARKING
YOUR
ORGANIZATION

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Why benchmarking is important
1. Understanding the market
for physician services
2. Establishing appropriate
physician payments
relevant to your
organization
3. Measuring performance to
certain standards

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Identifying benchmarks
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• Find the most appropriate match
• Compare similar organizations to yours
• Check sample size
• Examine the market range, and ask:
• What’s the median? What is the 75th percentile?
• Are there reasons for my hospital rates to be higher than the median?
• Are there characteristics of my hospital, the service or the physician that
could impact FMV?

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Use benchmarking for rates, documentation
• Healthcare organizations
often use market
benchmarks to set
physician payment rates
• Benchmarks can help in
the documentation
process, too
14

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Overall spend benchmarks
• While benchmarking on a contract by contract level
basis is straightforward, benchmarking your
organization on overall spend is more nuanced
• 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 allow hospital-wide
comparisons that give perspective on your payment
practices compared to other facilities
15

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KEY FINDINGS

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Our benchmarks
• MD Ranger calculates a facility’s
total non-salary estimated
physician spend
• 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)
and positions with no net annual
payment data
17

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Our benchmarks
Facility Total Benchmarks provide insight into the scope
and type of payments made by hospitals with different
characteristics such as size and trauma status.
18

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Our benchmarks
• Percent paying
• Number of positions
• Number of paid positions by service
19

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All hospital spending
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Mean
$9,424,640
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
25% 50% 75% 90%
PercentilesSource: MD Ranger, Inc.

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Call coverage spending
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Mean
$3,410,780
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
25% 50% 75% 90%
PercentilesSource: MD Ranger, Inc.

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Medical direction and administration spending
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Mean
$1,351,880
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
25% 50% 75% 90%
PercentilesSource: MD Ranger, Inc.

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MD Ranger hospital-based services
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• Anesthesia
• OB Anesthesia
• Critical Care
• Pediatric Critical Care
• Emergency
• Hospitalists
• OB Hospitalists “Laborists”
• Pediatric Hospitalists
• Psych Hospitalists
• Orthopedic Hospitalists
Neonatology
• Pathology/Clinical Laboratory
• Perinatology
• Maternal/Fetal Medicine
• Radiology
• Trauma

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Hospital-based service spending
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Mean
$4,661,990
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$10,000,000
25% 50% 75% 90%
Percentiles
Source: MD Ranger, Inc.

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Hospital-based service spending over time
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$0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000
2016
2017
2018
Source: MD Ranger, Inc.

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Number of paid coverage services
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Mean
13
0
5
10
15
20
25
25% 50% 75% 90%
PercentilesSource: MD Ranger, Inc.

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Who is most likely paid?
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
General Surgery Orthopedic Surgery Urology Neurology - Stroke &
Non-Stroke
Neurosurgery
Source: MD Ranger, Inc.

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Number of paid directorships/administrative services
28
Mean
29
0
10
20
30
40
50
60
25% 50% 75% 90%
Percentiles
Source: MD Ranger, Inc.

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Demographics and total spending
29
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
Source: MD Ranger, Inc.

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Trauma status matters
• Significant differences
between trauma and
non-trauma hospitals,
resulting from higher
payments AND more
services.
• Level I and II trauma
centers pay on average
32% more for call
coverage agreements
and have more services
on call and more
medical directorships
30

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Trauma vs. Non-Trauma total facility spending
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$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
25% 50% 75% 90%
Trauma Centers
Non-Trauma Centers
Source: MD Ranger, Inc.

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Trauma facilities over time
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Source: MD Ranger, Inc.
$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
2016
2017
2018
Trauma Facilities Medan Total Spend

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2018 trauma facilities call coverage spend
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$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
25% 50% 75% 90%

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Hospital size
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$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
Under 100 100 up to 300 300 and Over
Total Spend by Bed Size
25% 50% 75% 90%

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Using these benchmarks
• Compare your facility based
on key characteristics
• Compare facilities within a
system to identify outliers
and opportunities for
standardization
• Compare total payments for
types of services within a
facility and across a system
of facilities
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ABOUT
MD RANGER

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300+ Physician Benchmarks
• Call coverage rates
• Medical direction payments
• Administrative and leadership
services rates
• Hospital-based service stipends
• Diagnostic testing, etc.
• Clinic & hourly rates
Online Platform
• Benchmark lookups
• Contract proposal tools
• Contract reports by facility and
service
• Total facility costs + benchmarks
Research and Support
• Resources for education and
training
• On-call experts to help
subscribers use benchmarks
and tools
Compliance Documentation
• Contract-specific FMV
documentation reports
• Reports to assist with real-time
monitoring and annual reviews
MD Ranger

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Standardize
processes
and rates
Document
FMV
Access 300+
payment
benchmarks
Review
contracts and
monitor with
ease
Have smarter,
data-driven
physician
negotiations
Mitigate
compliance
risks
The foundation of your contracting process

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• Call Coverage (55+)
• Medical direction (100+)
• Hospital-based services (20+)
• Administrative
• Medical Staff Leadership
• Diagnostic/other services
e.g. ROP, autopsy, dialysis
• Hospital-based stipends
• Clinics, professional services
• Telemedicine
• Residency/teaching/GME
• Uncompensated care
• Meeting attendance, peer review,
IT/EHR and quality initiatives
• 13 Pediatric services, with more
emerging each year
Hospital-characteristics drill
down for ADC, bed size, trauma
status, urban/rural, stroke
centers, and more.
Our benchmarks
Used in academic medical
centers, integrated delivery
systems, and hospital
organizations.

40. New services for 2018
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 Thoracic Surgery call coverage
 Genetics medical direction
 Endoscopy/GI Lab medical direction
 Child and Adolescent Psychiatry medical
direction
 Nuclear Medicine medical direction
 Orthopedic Hospitalists
 Acute Care Surgery
 ...and more!

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Our subscribers
30%

42. Our methodology: key differences
• Providers vs. facilities: high
standards per ATSZ guidelines
• Verified, comprehensive data
from hospitals
• Thorough data audits
• Physician contract experts
on-call to review/advise on
challenging contracts

43. Meeting the unique challenges of healthcare
organizations
Make data-driven decisions for
your organization
Stop relying on surveys with
poor methodology
Streamline documentation and
ensure you are protected
against costly settlements
43

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• Do you feel confident in your
organization’s physician contracting
and FMV documentation process?
• Are you confused how much to pay
physician leaders for their time?
• Do you feel like your organization has
risky agreements?
We can help!
Reach out: apullins@mdranger.com or 650-692-8873
Need help with physician contracting?