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Value judgments: Considerations and pitfalls in medical directorship and call valuations

Insight Article - August 29, 2019

Benchmarking & Forecasting

Provider Compensation

Valuations normally happen with two goals in mind in a medical group practice:

  1. Valuing the business (Physician owners sometimes get divorced, after all.)
  2. Valuing services.

The reasons, however, are more a matter of compliance. Stark Law, the Medicare Anti-Kickback Statute and other federal regulations limit the types of business relationships into which physicians can enter and mandate a commercial reasonableness known as fair market value (FMV).

Differences in methodology that underpin valuation work can have a significant impact on a medical group practice’s costs as they relate to physician compensation. That’s where Timothy Smith, CPA, ABV, principal, TS Healthcare Consulting LLC, enters the picture.

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About the Author

Chris Harrop
Chris Harrop
Senior Editorial Manager MGMA

A veteran journalist, Chris Harrop serves as editor of MGMA Connection magazine, MGMA Insights newsletter and oversees several other publications across MGMA. Email him.

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