Preparation and clear thinking are keys to survival

The next few years are likely to see major changes in the practice of orthopaedic surgery, and physicians who are unprepared may find themselves on the back side of unfavorable trends, according to panelists at the 2010 Practice Management Symposium for Practicing Orthopaedic Surgeons. Moderated by Michael Q. Freehill, MD, the panel brought together surgeons from a variety of practice settings.

“I don’t think it’s any surprise that solo practice is not going to be the predominant model in the future,” said G. Klaud Miller, MD, who is himself a solo practitioner. “It’s prohibitively expensive for any resident or fellow to come out of practice and go into solo practice, certainly in an urban area.”

Dr. Miller pointed out that changes in medical practice driven by government requirements tend to be less about quality and more about saving money. Several studies have found that high volume centers produce shorter stays and fewer complications in total joint procedures than lower volume centers, and a recent paper found fewer reoperations in high-volume centers. He suspects that the government and, eventually, private insurers will build on this data and begin steering patients to high volume centers and specialists, leaving smaller and more general practices with a shrinking number of patients.

“If you happen to be at a low volume center, you’re just out of luck,” he said.

Challenges and opportunities
Smaller practices may improve their bottom line by taking part in government incentives to promote electronic health records and pay for performance, according to Stephen P. Makk, MD, MBA. Years ago, during what Dr. Makk referred to as the “Golden Age of Medicine,” physicians could take home 75 cents for every dollar taken in, but shifting economic conditions have reduced the net profit to about 20 cents on a dollar. Although some physicians are uninterested in the small gains offered by taking part in programs such as the Physician’s Quality Reporting Initiative, which currently offers a 2 percent incentive for physicians who report quality data to the U.S. Centers for Medicare & Medicaid Services, Dr. Makk said that those small returns can add up, especially when money is tight.

Dr. Makk also suggested that physicians in small practices be open to the idea of hiring physician extenders because nurse practitioners or physician’s assistants can offer high value to a practice.

“It’s just a question of introducing these people into your practices and your patients, and setting expectations,” he explained. “What people want is competent, compassionate care. They can get that from extenders as well as a surgeon, and honestly, a lot of what we see is not surgical.”

Aleksandar Curcin, MD, MBA, has begun addressing some of the issues of increased government involvement in medicine in his large practice by increasing collaboration with the local hospital. To that end, he has discussed models of participation such as gain sharing and managing the service line to provide additional income streams.

“We recently established a broadband connection between the hospital and all the various clinics, which is already allowing us to share information more effectively. As more pressure starts to mount for outcome-based reimbursement, we’ll be in need of sharing information even more quickly.”

Dr. Curcin’s practice has also considered merging with a multi-specialty medical group to better address changing conditions.

“If the medical home concept or some version of that gets implemented,” he said, “we as orthopaedic surgeons certainly wouldn’t be qualified to provide the full spectrum of care. We have a very large multispecialty clinic in town, and merging with that entity would allow us to provide the entire spectrum of services that would be required.”

Is direct employment for you?
Given the variety of challenges involved in private practice, some orthopaedists may consider moving to academics or hospital employment.

“I’ve identified four major reasons one might contemplate in making the transition [to an academic career],” said Adam D. Soyer, DO. “Uncertainty of long-term viability is at the top of the list. Mounting debt or poor cash flow, a change in the business model, the loss of a physician specialist partner, or a lack of productive partners are other reasons. An economic downturn in the community may also prompt one to consider making a change.”

Dr. Soyer listed an increase in the diversity of orthopaedic cases, opportunities for career advancement through research, and an improvement in quality of life as additional reasons to consider an academic career. These positive changes, however, may be offset by limitations to a physician’s autonomy.

“Decisions are made by the administration,” he explained, “and this is initially difficult to comprehend, but it covers every facet of daily practice. Institutional bureaucracy and slow progress in test completion can be very frustrating. It sometimes takes 10 e-mails to get a simple response.”

Furthermore, shifting to an academic career can be similar to starting over in practice. Salaries are lower, it takes time to assimilate into a new system, and as the most recent addition to a medical staff, an orthopaedist won’t wield much influence at first and his or her role may not be clearly defined. To minimize this, Dr. Soyer suggested that physicians transitioning to an academic career be proactive in networking and taking advantage of opportunities. It’s also a good idea to have a contingency plan at the time of contract renegotiation.

The orthopaedist as hospitalist
Under the right circumstances hospital employment can be advantageous, said Ian J. Alexander, MD, who has worked in a variety of practice settings. The salary is stable, the hospital handles all the overhead and administration, and scanning and other equipment is readily available. Job flexibility, paid leave and training days, productivity bonuses, and depending on one’s bargaining power, fewer requirements to take call are other pluses.

He stressed the importance, however, of being well-prepared when negotiating.

“Don’t accept the standard contract,” he emphasized. “Very few people actually sign the standard contract. They’ve all negotiated something. Your ability to change that contract depends on how badly the hospital needs you.”

Dr. Alexander suggested the following contract details: a statement outlining reporting relationships, an initial 3-month trial period without a termination penalty, as high a base salary as possible with a minimum of performance incentives, the ability to hire personal staff, reasonable office space, payment for cases when on call, 30 days of vacation and 10 education days, complete medical liability coverage, and bonuses that match those of hospital executives.

Additionally, he said to pay very close attention to the minor details of every contract. Some hospitals may try to include clauses that allow them to fire medical staff for very subjective infractions.

Peter Pollack is a staff writer for AAOS Now. He can be reached at ppollack@aaos.org