Steps to Optimize Hospital Budget with Physician Spend Data

This guide outlines steps to optimize a hospital's budget through the analysis of physician spend data. It emphasizes the importance of measuring physician spend, which encompasses the total amount spent on physician contracts within a network. The document details five actionable steps that can be implemented to enhance financial alignment with physician partners. The first step involves gathering at least two years of physician spend data, which aids in identifying large contracts for potential optimization and recognizing outliers among physician arrangements. The guide suggests evaluating total dollars spent by service line to ensure alignment with strategic goals. It also recommends reviewing hourly rates in contracts for consistency and examining contracts by their start dates to prioritize those that have been in place for five or more years. Additionally, it discusses the importance of benchmarking data to identify trends and outliers, as well as standardizing review processes for physician contracts.