Here are five things to consider when growing an orthopedic practice.
1. Partnering or merging with others for increased profitability. With reimbursements decreasing and provider costs for technology and healthcare reform upgrades increasing, it's a lot more economical for private practice physicians or small group physicians to join a larger practice than to strike out on their own, says Daniel Murrey, MD, MPP, a spine surgeon and CEO of OrthoCarolina. Larger practices have the access to capital and negotiating structure with hospitals and payors that can help individuals increase their profitability. These partnerships also benefit the larger practice because the mergers spread fixed costs across a larger group of shareholders. It also standardizes care delivery by the practices, which drives down healthcare costs. "We continue to see opportunities to partner with like-minded orthopedists and hospitals that share our strategic goals," he says. "In many cases, both sides benefit substantially."
However, make sure there is a comfort level between both groups before the partnership occurs. Don't merge with an unfamiliar practice or someone who is new to the area until you know they will fit within the practice culture. All of the merging practices with OrthoCarolina were longstanding referral partners of the physicians.
2. Reaching out to secondary markets. While maintaining a good presence within your primary market is important, practices in smaller regions may find it difficult to expand within their current areas. Michael Cox, PhD, CEO of Central Maine Orthopedics, suggests looking to nearby areas where you can market your services. "The Lewiston/Auburn area, where our practice is located, doesn't have any big cities, but it is a business hub. We have a significant presence in our community and have invested the time and personnel in reaching out to surrounding areas," Dr. Cox says. CMO began by working with critical care hospitals in their secondary markets by providing orthopedic services on-site in the hospitals' specialty clinics expanding CMO's market reach.
3. Recruit physicians and surgeons strategically. As the practice grows, more physicians are necessary to fulfill the needs of each community, says Mike West, CEO of Rothman Institute. Depending on the situation, it may be more beneficial to recruit a non-surgical orthopedic specialist to become a practice partner instead of a surgeon. "If the backlog of our physicians is in office visits with our patients, we will look first to hiring more non-surgical physicians, pain management physicians and non-surgical sports medicine physicians for that location," says Mr. West. "However, if we are backed up on the surgical side, we try to bring in more surgeons."
4. Investing in technology. A group need not be a technology leader unless this is their key strategy. At that same time, it must have sufficient technology so it does not become a hindrance to either patient care or becoming dominant in a particular type of area. A group needs to have a minimum level or technology investment simply to be able to practice and thrive. Dr. Ken Austin of Rockland Orthopaedics & Sports Medicine said that coordinating an EMR with his practice's scheduling and billing components has significantly increased efficiencies by reducing the number of hours spent entering information into a separate system. With the increasing prevalence of EMRs, this kind of technology becomes essential for a practice to provide efficient, state-of-the-art care.
5. Promoting common goals among all surgeons. It's important for physician partners in large orthopedic practices to have the same goals and share in each others' success. When Dr. Schwartz met with the other physician leaders to iron out the merger between his practice and three others, it was important for everyone to understand that nobody was trying to take advantage of anybody else or profit from the other groups. "If we all worked together, we would benefit," he says. "A big part of the growth process was getting used to that idea. We're looking at this as a merger; this is for the benefit of us all. The merger will allow us to exist in the new healthcare environment in a better way than any of us could have in our individual groups."
After the initial meetings about the merger, the lead representatives from each practice went back to their respective partners and talked about the discussions. It was through these channels that the leaders were able to share their ideas with their partners and create a culture of trust and togetherness.
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However, make sure there is a comfort level between both groups before the partnership occurs. Don't merge with an unfamiliar practice or someone who is new to the area until you know they will fit within the practice culture. All of the merging practices with OrthoCarolina were longstanding referral partners of the physicians.
2. Reaching out to secondary markets. While maintaining a good presence within your primary market is important, practices in smaller regions may find it difficult to expand within their current areas. Michael Cox, PhD, CEO of Central Maine Orthopedics, suggests looking to nearby areas where you can market your services. "The Lewiston/Auburn area, where our practice is located, doesn't have any big cities, but it is a business hub. We have a significant presence in our community and have invested the time and personnel in reaching out to surrounding areas," Dr. Cox says. CMO began by working with critical care hospitals in their secondary markets by providing orthopedic services on-site in the hospitals' specialty clinics expanding CMO's market reach.
3. Recruit physicians and surgeons strategically. As the practice grows, more physicians are necessary to fulfill the needs of each community, says Mike West, CEO of Rothman Institute. Depending on the situation, it may be more beneficial to recruit a non-surgical orthopedic specialist to become a practice partner instead of a surgeon. "If the backlog of our physicians is in office visits with our patients, we will look first to hiring more non-surgical physicians, pain management physicians and non-surgical sports medicine physicians for that location," says Mr. West. "However, if we are backed up on the surgical side, we try to bring in more surgeons."
4. Investing in technology. A group need not be a technology leader unless this is their key strategy. At that same time, it must have sufficient technology so it does not become a hindrance to either patient care or becoming dominant in a particular type of area. A group needs to have a minimum level or technology investment simply to be able to practice and thrive. Dr. Ken Austin of Rockland Orthopaedics & Sports Medicine said that coordinating an EMR with his practice's scheduling and billing components has significantly increased efficiencies by reducing the number of hours spent entering information into a separate system. With the increasing prevalence of EMRs, this kind of technology becomes essential for a practice to provide efficient, state-of-the-art care.
5. Promoting common goals among all surgeons. It's important for physician partners in large orthopedic practices to have the same goals and share in each others' success. When Dr. Schwartz met with the other physician leaders to iron out the merger between his practice and three others, it was important for everyone to understand that nobody was trying to take advantage of anybody else or profit from the other groups. "If we all worked together, we would benefit," he says. "A big part of the growth process was getting used to that idea. We're looking at this as a merger; this is for the benefit of us all. The merger will allow us to exist in the new healthcare environment in a better way than any of us could have in our individual groups."
After the initial meetings about the merger, the lead representatives from each practice went back to their respective partners and talked about the discussions. It was through these channels that the leaders were able to share their ideas with their partners and create a culture of trust and togetherness.
Related Articles on Orthopedic Practices:
5 Marketing Tips for Orthopedic Practices Using New Media
5 Ways to Optimize Orthopedic Practice Front Office Staff
5 Tips for Orthopedic Surgeons to Connect Better With Patients