Compensation Survey Basics
What Is A Compensation Survey?
Compensation surveys are a useful means for companies to decide how much to pay someone. In most industries, overpaying an employee keeps that person happy but hurts payroll costs and profitability. In physician compensation, overpaying can be illegal and lead to hefty government fines. In this environment, a compensation surveys become a necessity.
Aren’t Compensation Surveys Expensive?
Compensation survey costs vary widely depending on the level of customization and availability of the data. When compared to a facility’s payroll or the potential federal fines for being caught in non-compliance, the cost is well worth it. The cost of data can make a positive impact on your compensation rates that more than pays for the upfront expense.
What Alternatives Exist?
The most common way to document the compliance of contracts is to employ a FMV expert to write opinions, however these opinions can cost several thousand dollars per contract. Some organizations go the route of not consulting an outside source for pricing of contracts and instead make requests for coverage (RFCs) to physicians your community. The danger with RFCs is that physicians could collude and request more than the fair market value because they have market leverage. Despite meeting the "demands of the market", your contract could be at risk for non-compliance.
Why Should I Buy When I Can Get the Info Free on the Web?
Some limited compensation information is available for free on the internet; however, because of limited reporting and lack of detail, it is challenging, if not impossible, to determine if you are comparing apples to apples. Free compensation data generally does not give enough detailed information to be of good use to determine how much physicians should be paid.
Remember....Not All Compensation Surveys Are Created Equal
Every survey offers a different methodology. It is important to consider what you want to achieve with the information from the compensation survey. Research how the company collects and analyzes data. Some surveys are self-reported, some surveys utilize verified information, some are nationwide, and some are localized and conducted to demonstrate a specific argument.
With stakes so high, how can you afford not to use a compensation survey?