Our Approach to Calculating Benchmarks and Market Data

Stark Law requires hospitals to pay doctors fair market value.  The appropriate fair market value can be determined by utilizing benchmarks calculated from robust market data.  We have found that many hospital executives who are charged with making sure these compensation rates are compliant don’t have information on how benchmarks are calculated and what the best benchmark for their situation could be.

Federal Antitrust Safety Zone guidelines require that market data collects from at least five different “providers”.  Many market data surveys interpret this as meaning five physicians.  MD Ranger interprets the Antitrust guidelines conservatively and takes this to mean five different health systems or corporations/owners.  This ensures a particularly large, robust data set that often includes scores of individual physicians.

The Antitrust guidelines also mandate that no more than 25% of the data in each statistic come from one provider.  MD Ranger again considers that no more than 25% of the data come from any one health system, as opposed to an individual physician.  If a given health system has more than 25% of the data, MD Ranger weights these data points to make up only 25% of the statistic.

Want to know more about how we collect our data?  Click here.

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