Here are eight ways orthopedic practices can improve their bottom line. 1. Make it easier for patients to come through the door. Sonoran Spine Center is a patient-driven practice, which means the surgeons depend upon a high volume of cases to keep the practice running. Since there are specialists in several different spine-related areas, the group can accept most patients coming their way; however, they must also focus on quality to encourage those referrals.
"We want to see everyone who walks through the door," says Dennis Crandall, MD, founder of Sonoran Spine Center in Mesa, Ariz. "We need to have sufficient quality providers to meet our need for volume. Our care must be consistent with our patients' and referring physicians' quality expectations. We have to be able to take on surgical and non surgical cases, work-related issues, tertiary or simple cases."
Currently, the practice has four spine surgeons ranging in expertise from adult and pediatric scoliosis and other major deformity correction to caring for patients with degenerative and traumatic conditions. Additional medical specialists include a pain management physician, five physician assistants and one research nurse. In the future, Dr. Crandall hopes to add additional pain management specialists, tumor and spinal trauma surgeons to further extend coverage at the practice.
"We want to develop niche areas in spine we don't have covered right now," says Dr. Crandall. "It's hard for us to meet the needs we have right now and go after new business considering how busy we already are. However, this is an opportunity for the future and we are thinking about how to take advantage of it."
2. Shorten accounts receivable days. One of the critical performance indicators David Wold, CEO of Healthcare Information Services in Park Ridge, Ill., looks at with his surgeon's practices is the accounts receivable cycle. For the practice to make a profit, billing must be sent out promptly to get a return. Any unnecessary delay will cost a center its profit. When working with orthopedic practices, he looks at what the turnaround is for billing. "Track that on a monthly basis," he says. "By tracking the percentages in your accounts receivable, you're looking at it every month for trends."
Monitoring the cycle each month will allow you to see if you need to devote more or less resources to an account and keep better track of all dollars.
3. Low staff turnover, high engagement. As a way to support patient satisfaction and manage expenses, orthopedic groups should also be focused on keeping their staff happy. "Practices have to remember that their most valuable resources are their staff and they have to work really hard to keep their staff happy," says John Wipfler, CEO of OA-Centers for Orthopaedics in Portland, Maine. "The average medical practice turnover rate is 18-19 percent and we are somewhere around 9 percent — half of the national average."
It's important to keep good staff members who know how to treat patients consistent with your group's patient-centered culture and can quickly answer any questions patients might have about their care. Training new staff members takes a great deal of time and money, and if they leave the practice quickly they are a drain on resources.
"If you want to retain experienced and good people, it makes sense to put resources into keeping them happy," says Mr. Wipfler. "Pay is only the beginning and it doesn't need to be at the top of the scale. Respecting their wisdom, giving them a voice in the practice, having working committees with staff and creating many channels for hearing about what they are thinking and feeling. We want to keep morale up and be very transparent about what is happening in the practice. Enlist them in helping you solve your problems."
4. Invest in information technology. Patients, payors and referring physicians will demand reported outcomes in the future, and the best way to collect this information is through a good healthcare information technology system. These systems should interact with hospitals and other providers so you can stay on the same page.
"Invest in information technology in a way that you can measure and report outcomes, whether to payors or hospital systems, to prove what you are doing," says Todd Albert, MD, spine surgeon and president of Rothman Institute in Philadelphia. "Be able to measure patient satisfaction as well. All these things are publicly reported, so know what they are and be ahead of the curve before your statistics end up in the newspaper."
Once you are able to track your outcomes and define your quality, insurance companies and policy makers will come to you as they create treatment protocols. "You have to prove your method works, not just say it does," says Dr. Albert.
5. Provide ancillaries with continuity of care. It's very helpful for orthopedic practices to add ancillary services, if they haven't already, and fully integrate all services to provide the best continuum of care possible. OA includes fully integrated X-ray, MRI and physical therapy services and a surgery center in addition to its clinic, so patients can benefit from several specialists who are all in communication about their individual care.
"The patients understand that their care is communicated from point to point, and they appreciate it," says Mr. Wipfler. "Ancillaries are a big part of our ability to survive over time, in part because it is more cost efficient as well as improves quality of care as a result of the continuity of care by providers who are all on the same page."
6. Expand into new markets strategically. Opening new office locations can provide a great opportunity to serve patients in a new market and create more revenue for your practice. However, you have to make sure the new market location can support your office. Practices can test the waters by meeting with hospital administrators and potentially forming a partnership, such as a co-management arrangement.
"Nowadays, you are seeing a growing trend of physicians becoming employed by hospitals," says Alexander Vaccaro, MD, PhD, a spine surgeon and one of the founding partners of Rothman Institute. "That hasn't happened with our group. When we are looking to expand to a new location, we look at the area of orthopedic care and ask what would work well with the hospital. If the area is well served, we don't have an opportunity. If the area needs more orthopedic service, we go to the hospital and see how we can work with them."
7. Use marketing tools to brand your practice. Surgeons must market their private practices to drive patient volume and promote brand recognition. Khawar Siddique, MD, a fellowship-trained spine surgeon with Beverly Hills Spine Surgery in California, says it's important for practices to have a moniker that reflects their commitment to high level care, which is why his group decided to practice under the name "Beverly Hills Spine Surgery."
"Beverly Hills denotes a quality of care," says Dr. Siddique. "The name of your corporation should tell patients about the level of care you provide; such as Premier Spine Surgeons, Inc."
Focus on any aspects that make your group special in your marketing efforts. For example, if your group includes all fellowship-trained spine surgeons, tout your expertise to show you are a quality organization.
8. Provide cash-pay services. To combat declining reimbursement, Geoffrey Connor, MD,'s medical practice, D1 Sports Medicine, made the decision last year to begin targeting cash pay patients for his practice. While he is a trained orthopedic surgeon and performs joint replacement surgeries regularly, he also offers services such as platelet-rich plasma injections and in-office fiberoptic arthroscopy on a cash basis. Additional cash-based services include sports performance measures, such as body mass index and nutritional analysis, to create an environment of concierge sports medicine.
"If more subspecialists turn to the cash patient model, Medicare patients may have to wait longer for care or choose to pay more out-of-pocket," says Dr. Connor. "I don't want to scare Medicare beneficiaries, but hip implants and surgeries are expensive and the proposed rates just aren't viable. I set up a system like plastic surgeons or bariatric care; I'm trying to evolve an orthopedic practice that captures patients who need medical services with added value."
However, transitioning to a more cash based practice, including patients with a high deductible plan, isn't as easy as hanging a sign outside your front door. When patients are paying out of pocket for these services, they'll want the most bang for their buck. "With more out-of-pocket costs, patients will be far more demanding and expect a higher level of care, caring and services that are rare to find in today's orthopedic practices," says Mr. Champion.
Related Articles on Spine Centers:
Dr. Frank Cammisa: 8 Top Challenges for Spine Surgeons This Year
5 Trends Impacting Outpatient Spine in 2012: Thoughts From Dr. Thomas Schuler
7 Top Concerns for Spine Surgeons in 2012
"We want to see everyone who walks through the door," says Dennis Crandall, MD, founder of Sonoran Spine Center in Mesa, Ariz. "We need to have sufficient quality providers to meet our need for volume. Our care must be consistent with our patients' and referring physicians' quality expectations. We have to be able to take on surgical and non surgical cases, work-related issues, tertiary or simple cases."
Currently, the practice has four spine surgeons ranging in expertise from adult and pediatric scoliosis and other major deformity correction to caring for patients with degenerative and traumatic conditions. Additional medical specialists include a pain management physician, five physician assistants and one research nurse. In the future, Dr. Crandall hopes to add additional pain management specialists, tumor and spinal trauma surgeons to further extend coverage at the practice.
"We want to develop niche areas in spine we don't have covered right now," says Dr. Crandall. "It's hard for us to meet the needs we have right now and go after new business considering how busy we already are. However, this is an opportunity for the future and we are thinking about how to take advantage of it."
2. Shorten accounts receivable days. One of the critical performance indicators David Wold, CEO of Healthcare Information Services in Park Ridge, Ill., looks at with his surgeon's practices is the accounts receivable cycle. For the practice to make a profit, billing must be sent out promptly to get a return. Any unnecessary delay will cost a center its profit. When working with orthopedic practices, he looks at what the turnaround is for billing. "Track that on a monthly basis," he says. "By tracking the percentages in your accounts receivable, you're looking at it every month for trends."
Monitoring the cycle each month will allow you to see if you need to devote more or less resources to an account and keep better track of all dollars.
3. Low staff turnover, high engagement. As a way to support patient satisfaction and manage expenses, orthopedic groups should also be focused on keeping their staff happy. "Practices have to remember that their most valuable resources are their staff and they have to work really hard to keep their staff happy," says John Wipfler, CEO of OA-Centers for Orthopaedics in Portland, Maine. "The average medical practice turnover rate is 18-19 percent and we are somewhere around 9 percent — half of the national average."
It's important to keep good staff members who know how to treat patients consistent with your group's patient-centered culture and can quickly answer any questions patients might have about their care. Training new staff members takes a great deal of time and money, and if they leave the practice quickly they are a drain on resources.
"If you want to retain experienced and good people, it makes sense to put resources into keeping them happy," says Mr. Wipfler. "Pay is only the beginning and it doesn't need to be at the top of the scale. Respecting their wisdom, giving them a voice in the practice, having working committees with staff and creating many channels for hearing about what they are thinking and feeling. We want to keep morale up and be very transparent about what is happening in the practice. Enlist them in helping you solve your problems."
4. Invest in information technology. Patients, payors and referring physicians will demand reported outcomes in the future, and the best way to collect this information is through a good healthcare information technology system. These systems should interact with hospitals and other providers so you can stay on the same page.
"Invest in information technology in a way that you can measure and report outcomes, whether to payors or hospital systems, to prove what you are doing," says Todd Albert, MD, spine surgeon and president of Rothman Institute in Philadelphia. "Be able to measure patient satisfaction as well. All these things are publicly reported, so know what they are and be ahead of the curve before your statistics end up in the newspaper."
Once you are able to track your outcomes and define your quality, insurance companies and policy makers will come to you as they create treatment protocols. "You have to prove your method works, not just say it does," says Dr. Albert.
5. Provide ancillaries with continuity of care. It's very helpful for orthopedic practices to add ancillary services, if they haven't already, and fully integrate all services to provide the best continuum of care possible. OA includes fully integrated X-ray, MRI and physical therapy services and a surgery center in addition to its clinic, so patients can benefit from several specialists who are all in communication about their individual care.
"The patients understand that their care is communicated from point to point, and they appreciate it," says Mr. Wipfler. "Ancillaries are a big part of our ability to survive over time, in part because it is more cost efficient as well as improves quality of care as a result of the continuity of care by providers who are all on the same page."
6. Expand into new markets strategically. Opening new office locations can provide a great opportunity to serve patients in a new market and create more revenue for your practice. However, you have to make sure the new market location can support your office. Practices can test the waters by meeting with hospital administrators and potentially forming a partnership, such as a co-management arrangement.
"Nowadays, you are seeing a growing trend of physicians becoming employed by hospitals," says Alexander Vaccaro, MD, PhD, a spine surgeon and one of the founding partners of Rothman Institute. "That hasn't happened with our group. When we are looking to expand to a new location, we look at the area of orthopedic care and ask what would work well with the hospital. If the area is well served, we don't have an opportunity. If the area needs more orthopedic service, we go to the hospital and see how we can work with them."
7. Use marketing tools to brand your practice. Surgeons must market their private practices to drive patient volume and promote brand recognition. Khawar Siddique, MD, a fellowship-trained spine surgeon with Beverly Hills Spine Surgery in California, says it's important for practices to have a moniker that reflects their commitment to high level care, which is why his group decided to practice under the name "Beverly Hills Spine Surgery."
"Beverly Hills denotes a quality of care," says Dr. Siddique. "The name of your corporation should tell patients about the level of care you provide; such as Premier Spine Surgeons, Inc."
Focus on any aspects that make your group special in your marketing efforts. For example, if your group includes all fellowship-trained spine surgeons, tout your expertise to show you are a quality organization.
8. Provide cash-pay services. To combat declining reimbursement, Geoffrey Connor, MD,'s medical practice, D1 Sports Medicine, made the decision last year to begin targeting cash pay patients for his practice. While he is a trained orthopedic surgeon and performs joint replacement surgeries regularly, he also offers services such as platelet-rich plasma injections and in-office fiberoptic arthroscopy on a cash basis. Additional cash-based services include sports performance measures, such as body mass index and nutritional analysis, to create an environment of concierge sports medicine.
"If more subspecialists turn to the cash patient model, Medicare patients may have to wait longer for care or choose to pay more out-of-pocket," says Dr. Connor. "I don't want to scare Medicare beneficiaries, but hip implants and surgeries are expensive and the proposed rates just aren't viable. I set up a system like plastic surgeons or bariatric care; I'm trying to evolve an orthopedic practice that captures patients who need medical services with added value."
However, transitioning to a more cash based practice, including patients with a high deductible plan, isn't as easy as hanging a sign outside your front door. When patients are paying out of pocket for these services, they'll want the most bang for their buck. "With more out-of-pocket costs, patients will be far more demanding and expect a higher level of care, caring and services that are rare to find in today's orthopedic practices," says Mr. Champion.
Related Articles on Spine Centers:
Dr. Frank Cammisa: 8 Top Challenges for Spine Surgeons This Year
5 Trends Impacting Outpatient Spine in 2012: Thoughts From Dr. Thomas Schuler
7 Top Concerns for Spine Surgeons in 2012