On Monday, The New York Times made mention that a new model of care is needed in order for American geriatric care to survive.  I couldn’t agree more.

Our current model of primary care which pays family practice physicians pennies on the proceduralist’s dollar will not last — it can’t.  With the over-65 population projected to double within the next 20 years and medical schools graduating progressively less primary care physicians, there simply won’t be (and already isn’t) enough medical care to go around if we don’t find another way of providing primary care.

“There’s been a drastic decline in the number of geriatricians — and just 300 new ones are being trained each year — yet the number of people over 65 will double in the next 20 years,” Dr. Atul Gawande, a surgeon at Brigham and Women’s Hospital in Boston and an associate professor at the Harvard School of Public Health, said in an interview. “Those who work in geriatric care are among the worst paid in the health care system. Is the time I spend as a surgeon excising a patient’s cancer worth 10 times more than the time the primary care doctor spent finding the cancer in the first place?”

Medical practice in the slow economy is - to put it bluntly - tough.  Requiring difficult decisions by physician owners with regard to ways to cut expenses, outsource billing operations, maximize reimbursement, and still provide quality patient care, the economic recession has wreaked havoc on many private practices to date.

And there is more to come.

I blogged about the closure of a small medical practice in my hometown of King City, CA  back in September, and the harsh realities of an industry that must strike a balance between clinical expertise and business acumen in order for good, quality care to occur.  The deepening recession we are facing is but a stark reminder of the importance of this, and it is imperative that practice owners realize that their attention to the business elements of their practice is critically important to the care of their patients. 

I found the following article in yesterday’s Los Angeles Times which speaks to the cloud of insolvency that continues to loom over one area of medical specialty in particular - the primary care practice.  I encourage you to take a look at the article as it captures many of the obstacles faced by primary care physicians in today’s economy: slowing payments for services, poor reimbursement, high overhead, patient cancellations because of inability to afford services, and the use of ancillary, cash-based services to supplement revenues.

[Walford] hadn’t drawn a paycheck for herself since February. On top of that, her practice has cost her $40,000 in personal savings and left her with $15,000 in credit card debt. Walford, 39, also owes $80,000 in medical school loans. She shops at Ross and other discount retailers, and rarely eats out or takes time off.

…

Small general practices afford doctors autonomy to practice medicine as they see fit and can produce strong doctor-patient bonds. But these physicians have little or no clout to leverage better payments with insurers; they have no economy of scale, which makes overhead more burdensome.

…

“As people are tightening their belts, they are deferring things they think are a luxury or not absolutely necessary,” said Long Beach physician Jeffrey Luther, president of the California Assn. of Family Physicians. “We see people putting off physicals and mammograms and blood tests because they just don’t have the cash.”

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Click here or call (888) 827-5613 for information on a free program dedicated to helping private practices throughout the U.S. strategically adjust to the slowing economy.  Free program runs through March 31st, 2009 and is open to practice owners and administrators of any healthcare discipline.

Tannus Quatre PT, MBA is a practice consultant and principal with Vantage Clinical Solutions, Inc., a national healthcare consulting and management firm located on the west coast.  Tannus can be reached through the Vantage Clinical Solutions website by clicking here.

Primary care is a hot topic these days. 

Primary care physicians are frustrated by overwhelming patient loads and the associated paperwork, lowered esteem within the medical community, and a continued decline of medical students willing to join their ranks.

Is it about the money? Will the “patient centered medical home” improve the reimbursement for managing patients’ care and create enough cost savings to improve the financial lot of the primary care physician? Will advanced degree nurses, physician’s assistants, pharmacists and physical therapists be needed to support those physicians who continue to practice primary care?

It did not happen with the “gatekeeper” managed care model of the ’80s, so there’s at least cause to be skeptical.

In an editorial written by Emily Friedman , I think she correctly views the physician as a linchpin required to hold it all together.

A linchpin is defined as something that “serves to hold together the elements of a complex.^[5]” If there are not enough — or any — primary care physicians, the question is obvious: Who’s going to hold it all together?

Without the linchpin will healthcare costs be driven by patients’ self referral to specialists, similar to increased lay prescription requests advanced by direct-to-the-public pharmaceutical advertising?  Healthcare professionals need to have a greater means of being reimbursed for their knowledge so we can effectively help administer and direct effective care, not just prescribe pills and perform procedures. 

Maybe the primary care role will gain a new life if its acknowledgement as the linchpin within the healthcare industry reaches widespread adoption.  Only time will tell.

Like it or not (and debate certainly exists), mid-level providers are playing an increasing role in the primary care arena of the healthcare system.  In a recent study which examined data from greater than 300 retail clinics operated by such giants as Wal-Mart, Walgreens and CVS, utilization studies found that:

1. The vast majority of visits were for simple treatments such as ear infections, immunizations, and blood pressure checks.
2. Insurance was billed (and paid) for most of the visits.
3. Most of the patients that used the retail service didn’t have an established primary care provider.

This is relevant information for private practices because it helps us understand how people are using this more accessable (albeit, more fragmented) type of care environment.  By understanding this, we can begin to conceptualize ways that these mid-level provider practices should structure themselves and function in order to best care for their patients.

One suggestion that is evident is that mid-level provider practices should (1) address the “urgent care” needs of their market because that is how utilization currently happens, and (2) work on the development of comprehensive disease management tracts in order to properly prevent and maintain disease conditions for those that otherwise don’t (and likely won’t) have an established primary care relationship to keep them healthy.

Here’s a link to an article on the topic at the WSJ Blog.

Most of the patients said they didn’t have a primary care provider. One concern about the clinics is that they would lead to further fragmentation of care, by disrupting the patient-doctor relationship. “We found that three-fifths of patients did not report having a PCP, so for these patients there is no relationship to disrupt,” the authors write.

It’s not the best doctor that is guaranteed the best private practice.  It’s not the smartest physical therapist that sees the most patients.  It’s not the most compassionate dentist that stays in business the longest.

On the contrary, some of our best doctors, physical therapists and dentists don’t have the best practices, see the most patients, or stay in business the longest.  I see this in daily practice as I help private practice owners run their businesses, and last Friday I saw it happen to a physician from my birthtown of King City, CA.  The headline read, “Harrison to leave family practice,” and the article was a very transparent look into the reasons for his departure: business failure.

“I’ve gotten to do the best job imagined,” Harrison reflected, “I would continue if I could.” He went on to explain the closure is for business reasons, stemming from no one reason in particular, but a collection of bad decisions that hurt the overall business.

Dr. Harrison is a great doctor and a good man.  I know this because I know him personally - he delivered my son in the early 90’s and I have seen him off and on over the years.  I know that Dr. Harrison is a pillar of his community in the small town of King City, CA, and that his leaving will affect many by severing relationships that have kept a town healthy and brought comfort to those that called him doctor.

It is upsetting that the reasons for his departure are not because he is retiring or moving to a new home.  Dr. Harrison is leaving practice because his business failed. 

A career spanning multiple decades, providing quality care to a town that needs him - ended abruptly because the numbers didn’t pan out.  This can, in part, be chalked up to a healthcare climate that simply doesn’t support the general practitioner such as Dr. Harrison.  I’ve blogged about this many times (see posts here and here).  The other half of the equation though, is that physicians, dentists and physical therapists must acknowledge that private practice is a business - pure and simple.

I’ve debated this, and some disagree, citing ethical arguments for the separation between the two.  They view healthcare as a human need that supersedes business strategy and market forces - healthcare providers should just be able to focus on taking care of patients, not running a business (Heaven forbid a private practice desire to turn a profit…).

I believe the two actually go hand in hand - that the words “healthcare” and “business” can be used in the same sentence, and in a constructive, humanistic way.  My best argument for this comes in the examples of successful private practices that honor their responsibility as business owners to earn a profit - only so they can then use part of that profit to help others who are less fortunate.  This, if a practice owner so chooses, is powerful proof that business has a place in medicine, in dentistry, and in physical therapy.

And if you still don’t agree, you don’t have to look any further than Dr. Harrison to see proof that successful business is critical to one’s ability to serve others in the healthcare industry.

“There’s a lot of potential and real insolvency in medicine,” Harrison noted, adding that five physicians will soon leave their practices in the Monterey Bay area alone. The problem stems from a nationwide crisis of mixing the need for medical care with the practice of private business, he explained.

My best wishes and luck to Dr. Harrison in his new career, whatever road he takes.

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Click here or call (888) 827-5613 for information on a free program dedicated to helping private practices throughout the U.S. strategically adjust to the slowing economy.  Free program runs through March 31st, 2009 and is open to practice owners and administrators of any healthcare discipline.

Tannus Quatre PT, MBA is a practice consultant and principal with Vantage Clinical Solutions, Inc., a national healthcare consulting and management firm located on the west coast.  Tannus can be reached through the Vantage Clinical Solutions website by clicking here.

Decision-making, despite its importance and prevalence in clinical care, has a hard time fining its way into the business side of healthcare.  Let’s face it, decisions are hard to make for a cohort that cites risk aversion as one of the most common reasons for not starting a private practice in the first place.

And no other place within the business of healthcare is decision-making more hard to come by than with marketing.

It’s not the decision as to whether or not to market that’s so tough (though controversy exists there as well), but rather the decision about who to market to that reminds me of some of the most labor-intensive decisions we have to make in life.  And while deciding on a market for a healthcare practice may rank up there with the other big decisions we make (you know, choosing a color theme for our bathroom linens, deciding whether or not to get the extended warranty for the DVD player), it really doesn’t have to be that hard. 

The problem is twofold: (1) We generally think we’ve got one chance to get it right and really don’t want to blow it, and (2) we actually think we can be everything to everyone, so we give it the old college try.

Both of these are myths of course within private practice, and if we can dispel these and bring a healthy level of focus and distinction into our business strategy, odds are the decisions will fall right into place and we’ll not only know who our target market is, but we’ll be able to do a pretty darn good job of serving it.

Myth #1: We’ve got one chance to get it right.  Generally speaking, we actually don’t want to screw up on choosing the right market for a medical, dental, or physical therapy practice - each requires a significant amount of capital, and for the risk averse, this by itself usually lends itself to healthy deliberation.  The thing is, choosing a target market for a practice isn’t like trying to find the one blue marble in a bag of 500 red ones.  Think of the bag as containing every shade in the spectrum from deep red to bright blue.  Yeah, we don’t want to choose brick red, but it’s also OK if we don’t get sky blue the first time around. 

If you’re starting a physical therapy practice and aren’t really sure if you want to go after the women’s health market or the general outpatient orthopedic population (as you’re dually trained), realize that there are commonalities to both (yes, women do have general orthopedic conditions that crop up from time to time) and that by choosing a direction, you’re not casting an eternal spell on your practice that will never allow you to change. 

Now, there are some considerations that should be made when making this decision, including how to back out if indeed it doesn’t pan out for the long term, but these are well handled through a sound branding and marketing strategy that builds into it a flexible architecture and messaging strategy that can unfold in a couple of different ways depending on the direction the wind ends up blowing.

What generally doesn’t work however, is making the decision (not much of a decision actually) to do it all.  Why wouldn’t you want to do it all you ask?  Doesn’t that open up many more doors by casting a wider net?  Well, yes, but in theory only.  The reason you don’t want to do it all is because you likely can’t, which brings us to myth #2.

Myth #2: We can be everything to everyone.  We’re not designed to think of ourselves as incapable of doing what we set out to do.  In healthcare especially, the level of intellect and drive is of the highest around, so why wouldn’t we be able to go in multiple directions at once; be kind of a one-stop-shop to all who need us? 

We can’t do it because like any other mortal, when spread too thin we can only scratch the surface in terms of quality, time, and energy (sort of important in healthcare), and even if we could do a great job at it, the lack of focus wouldn’t communicate to the marketplace that we are distinctly different from our competitors. 

Surprisingly, being good - or being different, is just as important as communicating that we’re good - or different.  Certainly an argument exists that many of us would rather be good than have others think we’re good - the problem is, that if nobody knows we’re good we can’t really help those that need us anyway.  This is precisely what happens when we lack a defined focus in our selection of a target market and/or specialty for our practice.

Now, it’s important to understand that the takeaway here is not that one can’t be a generalist and survive in today’s healthcare marketplace - on the contrary, generalists are one of the most critical components of the system as a whole.  What should be conveyed is that even a generalist who has selected her specialty (general practice) has many decisions to make about how to focus her practice around other elements that will influence the level of focus and distinction the practice holds in the market.  Decisions regarding which insurance contracts to solicit (drives patient mix and revenue diversity), which age group to target, and which referral sources will provide the best partnerships for the life of the practice, will have longstanding effects on the practice, and aren’t amenable to a “straddle-the-fence” kind of approach.

By making decisions that limit the need for the practice owner to be everything to everyone, the quality, enjoyment, and overall experience within the practice is elevated significantly for those receiving the focus of the marketing and operational efforts; a big win for all involved.

Here is a post on the Entrepreneurial MD blog that speaks to this very point, and I recommend it as a succinct, quick read on the benefits of focusing on a target market.

In order to immunize your business against recession, you need to discriminate. While this is not a comfortable word for the politically correct amongst us, one of  Webster’s definition of discrimination is “the quality or power of finely distinguishing”.

Back in May I wrote about how Cigna and United Healthcare lashed out at concierge physicians by terminating them from contract panels, citing “contract violation” as the reason.  I wasn’t privy to all of the details as relates to the contracts, and wrote about the story not to form strong opinions, but rather to bring the story to the attention of our readers, some of which employ concierge practices.  As a business consultant to private practices, this story also held personal relevance to me and my company as we frequently find ourselves amidst the 3-way power struggle that exists between our clients (physicians and healthcare providers), their payers, and their patients.

I colored the post as an insightful, albeit brief, two-sided look at the issue, both from the perspective of the healthcare provider as well as from the insurer.  No real right or wrong, just the facts as they were understood.  I did give cause, I believe, to acknowledge the creativity and innovation of the concierge model, as we truly support and encourage the free market response to a healthcare system that truly provides a disincentive to the provision of thoughtful, quality care, in lieu of high volume, low cost service.

Now, we believe both in free market innovation from those providing care, as well as in the protections afforded us as individuals through the availability of healthcare insurance.  Both need to be able to survive financially if we are to help our collective society receive the care it needs.  We get it.

We actually go so far as to preach to our clients that in the face of tough financial decisions it is far more noble to protect the interests of the business that serves many, than the interests of few, if those few may cause the ship to sink.  We understand that this applies both to healthcare providers as well as insurers, and as long as each are acting in the interests of their patients, debate over the “best” model or the “best” contract can make for healthy discussion. 

What we don’t preach however, is that profit motives and power should at any point override our responsibility to advocate for the best interests of those we serve - a responsibility that has been called into question in the move by insurers to squash concierge care of late, simply because they aren’t a part of the model.

Today, the Arizona Republic reported that once again an insurance company, this time Blue Cross Blue Shield (BCBS) of Arizona, recently informed Dr. Steven Knope, a concierge physician in Tucson, AZ, that his contract is in violation and may be terminated.  BCBS claims that this move is in defense of their members, and they are concerned that their members must pay rates that are not agreed upon in the contract. 

When well spun it kinda sounds legit - I mean, if a contract says it’s going to cost X to receive Y, then you can’t charge a yearly retainer to get it.  The issue is, Dr. Knope doesn’t submit claims to BCBS for his concierge patients, so it’s unclear as to how this can in any way affect contractual obligations he has to BCBS. 

In defense of the concierge model, my overwhelming inclination is to this time shake my finger at BCBS and chalk this move up to a power play that desires to control the money flowing through all of the care provided by this physician’s practice - when they don’t need to. 

The outcome is the really interesting part of this move by BCBS.  If this show of power by BCBS doesn’t relent, this will serve to: (1) Sever the relationship of BCBS members with their longstanding physician, interrupting the quality and continuity of care they receive, (2) BCBS will formally take the position that member loyalty plays a distant second to their control of the flow of cash through a small practice in Arizona, and (3) Dr. Knope, while undoubtedly disappointed at the termination of his relationship with his patients, will experience an uptick in his profitability because an insurance company cancelled a contract that he didn’t really need in the first place because he operates a business model that doesn’t depend on the 3rd party payer system.

The political atmosphere fueled by the public’s continued frustration keeps healthcare issues in the forefront.  Is insurance coverage, universal or otherwise, the real issue that will cure the “healthcare crisis” in America?  A recent piece written by Maggie Mahar points to the complexity of issues and the fact that “covered” individuals have very real problems receiving necessary services. One of the significant problems identified is the shortage of Primary Care Physicians (PCPs).  The shortage is expected to continue as medical school graduates require higher paying specialties to offset the tremendous debt from school.

As discussions of healthcare reform continue, one of the focuses is around the “medical home” model. This model calls for every American to have a “home” for their medical care, a PCP.  The PCP will coordinate care and manage referrals to specialist. Avoiding unnecessary costs and gain efficiency from healthcare IT such as electronic medical records.  

Commonwealth Fund president Karen Davis explained how physicians would be compensated: “in addition to fee for service [the practice would receive] a monthly . . . fee for being a medical home. It’s a blended system of payment, which has worked very well in Denmark, where  people have well-established relationships with primary care and compensation for primary care is on a par [with] or even higher than compensation for specialty care.

Does this sound like the managed care, gatekeeper model of the late ’80s and early ’90s mixed with concierge medicine?

Vantage Clinical Solutions is proud to partner with author and concierge physician, Dr. Steven Knope to present a one-day workshop dedicated to the concierge medicine model (also known as retainer medicine).  The workshop is titled, “Become a Doctor Again: Making Concierge Medicine Work for your practice,” and is intended for primary care physicians who are interested in learning about how the concierge medicine model works, how to determine when concierge medicine makes a viable business model, and how to ultimately transition a current medical practice to the concierge, or retainer model.

The concierge medicine workshop will be held Saturday, November 15th from 8am - 4pm in Phoenix, AZ at the Doubletree Phoenix-Gateway Center.  Early bird registration is $595 (received by October 17th) and regular registration is $695 and must be received by November 7th.  Registration is available online by clicking here, and phone/fax registration is also available.  Phone: (888) 827-5613/Fax: (541) 550-7356.

Dr. Steven Knope is the author of “Concierge Medicine: A New System to Get the Best Healthcare” and has owned his own concierge practice for 8 years (click hereto visit Dr. Knope’s website).  He is a pioneer in the area of concierge medicine and is cited frequently by publications and news agencies on the topic of healthcare trends, including the role that concierge medicine plays within our current healthcare arena.

Vantage Clinical Solutions is proud to partner with innovative practice owners and leaders such as Dr. Knope to educate and mold the healthcare landscape through the use of entrepreneurship, creativity, and innovation.  We encourage primary care physicians who are interested in learning more about this innovative trend in healthcare business models to take this opportunity to learn from this dynamic and pioneering physician.

We’ve blogged a lot about the primary care shortage in America (read a few posts about it here and here and here…and here) and the resulting impact this is having on patients who are looking for a primary care physician and can’t find one.  But this is only one impact the shortage is having on the healthcare economy.

There are many primary care doctors who have made the choice to stick it out and remain “cognitive specialists” in a failing system, and while it is a struggle, many find a way to survive.  There is strength in numbers though, and the ability for primary care physicians to stick together, recruit, and partner together to tackle the challenges that are thrown their way is reaching a tipping point whereby the numbers aren’t there to support a group approach to primary care practice - there simply aren’t enough doctors, especially in rural and underinsured areas.

Read more in the Baltimore Sun about a report released by the National Association of Community Health Centers on the topic.

When his colleague departed in December, family doctor Charles Bennettthought he would soon find a new partner for his private practice in Lusby. But he has had no luck for the past eight months.

“I’m still trying to find someone, but I don’t think it will get any better in the foreseeable future,” said Bennett, whose Calvert County practice employs four staff members. “The process is very time-consuming, and I am already very busy as it is.”

Bennett’s troubles stem from the fact that the United States faces a serious shortage of family physicians, especially in rural and poorer communities. There are too few primary care doctors and nurses to meet growing health care needs, according to a report released yesterday by the National Association of Community Health Centers. The study found availability depends on location.