4 Best Business Practices for Spine ProgramsWritten by Lindsey Dunn | November 30, 2009
Chicago-based NeuStrategy and San Diego-based SpineMark recently completed a nationwide survey of hospital-based spine programs to determine best practices of leading spine programs.
The Spine COE® (Center of Excellence) Survey evaluated the infrastructure of four critical components — programs, staff, facility/technology and business — of 99 spine care programs across 35 U.S. states and three international locations. The survey segments participating hospitals into two categories: emerging versus comprehensive programs, with comprehensive programs leading the way in spine care.
The results of the survey shed light on some of the best practices being employed at leading spine programs across the country. Theodore Michalke, managing partner, at NeuStrategy, shares the four best business practices for hospital-based spine programs as indicated by the survey.
1. Strong clinical and administrative leadership. Leading spine programs distinguish themselves from other programs with strong clinical and administrative leaders that work collaboratively to improve the program, says Mr. Michalke.
"Leadership is where many organizations stumble. Because spine care can be delivered in so many different locations, it is difficult to create a true spine program without a common leadership thread," he says.
Generally, top programs appoint a surgeon or other physician leader to head the clinical side of the program, who is typically given the title of medical director.
"The clinical leader needs to be a physician who has earned the respect of other providers in the program," says Mr. Michalke. "The right clinical leader creates an environment where physicians, mid-level practitioners and nurses work together seamlessly to support both surgical non-surgical spine treatment."
An administrative leader is essential to the business-end of the spine service line. Comprehensive spine programs are more likely to have a dedicated spine program director than emerging programs, which often have a program director who oversees the program as one component of a larger service line, such as orthopedics or neuroscience. Thirty-five percent of comprehensive programs had a dedicated director as opposed to only 12 percent of emerging programs, according to the survey.
Mr. Michalke recommends that the administrative leader hold a senior-level position within the organization and have a strong business orientation as well as customer relations and market development experience.
Once a program has strong leadership in place, it must work to ensure these two leaders work together to improve the program.
"You need leaders who wake up thinking, 'What can I do today to improve our spine center?'" says Mr. Michalke.
2. Establish interdisciplinary governance to determine strategic direction. Spine programs need a governance structure that encourages collaboration among the program's clinical and administrative leaders, according to Mr. Michalke.
A governance committee is typically composed of up to 10 members, which includes physicians from various spine-related specialties, mid-level providers, program administrators and allied service representatives, such as nursing and rehabilitation therapy.
The governance committee helps set the strategic direction of the program and in turn informs hospital administration on investments and facility and technology issues to build and support the program, says Mr. Michalke.
"The committee really becomes a clearinghouse for getting consensus among leaders of the spine program," he says. "The committee is a platform for vetting clinical decisions about which clinical and research services are most important and which technologies get fast-tracked through the hospital's capital committee."
3. Guard against financial calamity. Spine program leaders must also follow common business practices for protecting and improving the program's financial performance. Leaders must closely monitor reimbursement, implant costs and new technologies as variations can rapidly erode profits and erase margins, says Mr. Michalke.
"We have seen organizations have dramatic swings from being very profitable to having significant losses in very short time frame — maybe six months to a year," he says. "Often in these situations, the purchasing arm isn't closely watching contracts with the vendors or utilization patterns have shifted rapidly. In some cases, spinal implant costs have tripled or even quadrupled, depending on the specific product, over last several years and reimbursement has not kept up."
Leaders need to regularly examine cost and reimbursement data and engage hospital leadership about any reimbursement problems that result from the hospital's contracts with payors. Proactive program leaders also know it is important to encourage physicians to engage the vendors achieve the best possible pricing for heavily-used implants and supplies, says Mr. Michalke.
4. Spread the word about your program. Finally, programs must market themselves to potential patients and referring physicians. Marketing efforts, however, should follow development efforts as a strong, comprehensive program is needed to be successful with marketing. According to the survey, 90 percent of comprehensive spine programs reported primary marketing outreach, while only 48 percent of emerging programs reported these efforts.
"Don't let your success be a secret," says Mr. Michalke. He recommends programs use direct-to-consumer tactics, referring physician outreach, payor relations and employer-oriented programming to market their programs. Consumer-oriented services like spine care lend themselves to print and radio advertising, but more targeted activities such as educational programs in the community about how to avoid back injuries also help sell the program, he says.
Mr. Michalke also suggests that programs promote the comprehensive nature of their care. "Frankly, the last thing consumers, payors and employers want to hear about is surgery," says Mr. Michalke. "Since almost 90 percent of back and neck patients will never need surgery, it's important to talk about your continuity of spine care that can help patients avoid surgery. When surgery is necessary, patients in comprehensive spine centers can rest assured that all appropriate non-surgical pitons have been exhausted."
Read four best practices for hospital spine center programming unveiled by the Spine COE® Survey.
Read four best practices for hospital spine center staffing unveiled by the Spine COE® Survey.
Read three best practices for hospital spine center technologies and facilities unveiled by the Spine COE® Survey.
Learn more about the Spine COE® Survey.
Note: "COE" is a registered trademark of NeuStrategy, Inc.
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