Tallahassee Orthopedic Clinic has around 103 providers, including 40 surgeons, and has its sights set on growth.
Even as CMS revealed plans for yet another pay cut in the 2025 physician fee schedule, CEO Mike Boblitz aims to stay on target with the group's revenue and investment goals as part of a strategy that takes Medicare pay cuts into account.
"To survive, you have to outrun Medicare cuts, you have to outrun inflation," said Mr. Boblitz during a session at the Becker's 21st Annual Spine, Orthopedic & Pain Management-Driven ASC event in June. "The only way they do that is revenue. Our model, our business is really a higher labor model. We don't want to impact that for quality of care, so we focus on growth."
TOC has launched several growth initiatives in recent years, and doubled the footprint of its orthotics and prosthetics program. The practice also invested millions of dollars into opening a location in a new market, Panama City, with orthopedic practices and a surgical center.
"It's a portfolio of investments we think will prepare us for another 50 years of success," said Mr. Boblitz.The practice has around $35 million of capital investments planned as part of their Vision 2030 initiative. Much of the $35 million investments are frontloaded, and the practice has been able to access equity out of TOC's real estate portfolio to pay it forward, and the group plans to repay the real estate back over time.
The practice also launched an orthopedic fellowship program to train the next generation of surgeons. But Mr. Boblitz is also seeing new surgeon partners who are closer to the tail end of their careers as well.
"We're getting a lot of physicians as we speak joining the group that are mid-career, hospital-employed physicians that feel like they don't have autonomy," said Mr. Boblitz. "I always say specialization matters, and I believe that's the future of orthopedics: specialization and stay in your lane. We're seeing it actually swing back [to independence practice], which is good."
Mr. Boblitz set the goal of double-digit revenue growth for TOC every year by focusing hard on regional expansion and diversifying the practices business.
"As one market takes headwinds, we have our other markets that can prop us up," he said. "We're really focusing on a lot of diversification, and then at the same time, recognizing, probably not in my lifetime, that Medicare is not going to stop the annual cuts that they always do and the fight back and forth. We have several income buckets. The clinic is the legacy income bucket, but focusing on our surgical centers and really trying to improve value there and align with the purchasers to help them reduce costs is a big focus of mine."