No one individual can alter the economy, but there are many avenues one can take to help weather the effects of the changing economic landscape.
Three orthopedic surgeons connected with Becker's to discuss how orthopedic practices can become more economically resilient.
Ask Orthopedic Surgeons is a weekly series of questions posed to surgeons around the country about clinical, business and policy issues affecting orthopedic care. We invite all orthopedic surgeon and specialist responses.
Next question: What healthcare trend are you hoping disappears in 2024?
Please send responses to Riz Hatton at rhatton@beckershealthcare.com by 5 p.m. CST Thursday, Jan. 18.
Note: Responses have been lightly edited for length and clarity.
Steven Barnett, MD. Chief Medical Officer at Hoag Orthopedic Institute (Irvine, Calif.): Focus on outcomes and patient satisfaction. It is important for orthopedic surgeons to manage and operate patient-centric endeavors making this the center of your value-based equity circle. Diversification allows you to build a more comprehensive operation, by adding services such as physical therapy, rehabilitation or nonsurgical orthopedic care. At Hoag Orthopedic Institute, in 2023, we added a conservative spine program to address many of the preventive and nonsurgical treatments that can help relieve low back pain. This extended our brand and helped solidify our enterprise as a leader in musculoskeletal care. Utilizing our own physical therapy centers as well as partnering with others in the community allowed us to create an extensive network to serve the needs of these nonsurgical patients.
Embrace the transition of surgical procedures migrating to the outpatient setting. Evolution of surgical technique including the use of technology as well as anesthetic protocols allows us to perform many more procedures safely with day-of-surgery discharge. Patients benefit in that they can often receive treatment in a local ASC while recovering at home, reducing the risk of infection in these historically inpatient surgeries.
John Corsetti, MD. Orthopedic Surgeon at New England Orthopedic Surgeons (Springfield, Mass.): The most important strategy in weathering the constant economic storm buffeting orthopedic private practices is to develop multiple streams of revenue that don't directly depend on reimbursements for surgical and office care. As we've learned over the past three decades, insurance carriers as well as CMS are predictable in their march to the bottom. Just when it seems they can't reimburse any more poorly, they do. In the face of historic inflationary pressures, exacerbated by the labor shortage, CMS has the temerity to roll out a 3% reduction in the fee schedule.
One effective way to maintain economic solvency is for practices to develop ancillary revenue streams. Examples include physical therapy, ambulatory surgery centers, co-management agreements, practice-owned real estate (with a robust succession plan to allow future partner entry), imaging and others. If properly managed, these ancillaries generally grow proportional to practice growth allowing for predictable revenue streams for all providers as the practice enlarges.
Other strategies that have proved useful include practice aggregation, which may lead to better reimbursement contracting due to leverage and quality. Finally, top line practice growth, with a goal to outpace the rate of overhead growth, must occur. This requires a well-thought-out three- to five-year growth strategy to always be in place.
Nicholas Grosso, MD. President of the Centers for Advanced Orthopaedics (Bethesda, Md.): Orthopedic practices striving for economic resilience must adopt new strategies, embrace the digital landscape, and think outside the box. Integrating new technologies and incorporating digitally based solutions, such as remote patient monitoring and remote physical therapy, helps to advance the bottom line. However, proceed with caution when partnering with third-party vendors. You will want to research the stability and the value they bring to the table in terms of return on investment.
It is also essential for orthopedic practices to establish a digital front door to ensure a steady influx of patients. Physicians must provide services across a digital spectrum and utilize new ways to engage patients. With only a finite number of patients a physician can see in a day, practices have explored the integration of physician extenders, such as physician assistants and nurse practitioners, into their teams. To ensure financial resilience, another physician extender will be the implementation of digital solutions. Leveraging new technologies holds great promise for creating additional revenue streams, thereby mitigating the continuous rise in costs and preventing declines in overall revenue.
While increasing fee-for-service rates remains a valid option, there's a threshold where practices must do more. Seeking better contracts is advisable, but in our evolving landscape, orthopedic practices must break away from traditional models and embrace unconventional approaches to thrive economically.