How Can Orthopedic Groups Compete with Hospitals or Health Systems?

In the new decade, orthopedic providers will be observing changes in the orthopedic marketplace—namely, finding that private orthopedic practices are diminishing in numbers. Why? According to the 2019 Medscape survey data, fewer than 50 percent of U.S. orthopedic physicians are maintaining their own practices. Additionally, hospital mergers and acquisitions are on the rise, private equity firms are increasingly acquiring primary care practices, and national service firms continue buying independent practices. 

The survey also determined that orthopedists primarily are working across the following areas:

• Office-based single-specialty group practices – 39%
  
• Office-based multispecialty group practice – 16%
  
• Hospitals – 14%
  
• Office-based solo practice – 11%
  
• Healthcare organization – 11%
  
• Academic (non-hospital, research, military, government) – 7%
•  Outpatient clinic – 0%

Current Trends in Orthopedics 

Outpatient Procedures

Less invasive outpatient procedures are on the rise—arthroscopy and arthroscopically-assisted surgical procedures are some of them. New technologies, devices, instruments, and more will contribute to a higher volume of outpatient cases, shorter lengths of stay, and lower costs of care. 

Other trends

Clinical integration of rehabilitation therapies

Outpatient orthopedic rehab therapy is far less costly than surgery or hospitalization. Positive patient outcomes and an increase of patient access to rehab therapy through government regulations has increased demand in the market. Orthopedic practices that add rehabilitation services can increase profits and support a positive care continuum. 

 

Orthopedic Organizational Models

Private Practice Groups

• Pros: Clinical and financial autonomy, and customized patient experience
• Cons: Financial risk, and lack up upward mobility
  
• Compensation: “Eat what you kill”

Hospitals and hospital-affiliated groups

• Pros: Low administrative responsibility, low financial risk, opportunity for professional growth
• Cons: High volume/productivity expectation, loss of independent decision-making
• Compensation: Salary with incentives tied to productivity, quality or other metrics

Mega-physician groups

• Pros: Diversity if service offerings, shared financial risk, power in numbers
• Cons: Shared financial risk, decisions made by committees, increased scrutiny on stark/anti-trust violations
• Compensation: Salary with incentives tied to productivity, quality or other metrics

Private equity companies

• Pros: Initial cash injection, ongoing access to capital, local control is maintained
•  Cons: Bottom line and profit considerations, staff attrition
•  Compensation: Salary with incentives tied to profit margin, rollover equity/option

National physician services companies

• Pros: Initial financial reward for partners, operational expertise, long-term strategy growth
• Cons: Bottom line and profit considerations, loss of local control • Compensation: Salary which may include bonuses

Shifting reimbursement models that are driving change

Value-based payment models and the challenge to remain independent: Fee-for-service vs. Fee-for-value–the shift to value-based reimbursement and alternative payment methods (shared savings, bundled payments, ACOs, etc.,) has exacerbated the challenge of independence. 

Rising quality performance pressure

Some payers are only reimbursing providers if they are willing to take on more risk—demonstrating that patient outcomes are improving and the care they provide is valuable. 

Bundled payments

Bundled payments are pre-determined allowable expenditures for an episode of care. Be aware that 
while providers are rewarded if they keep costs below the predetermined cost of care, they also must cover costs that go beyond the target price for the episode of care.

 

Solutions to remain independent

Hands-free EHR to empower the high-volume orthopedic physician

• Document the way you want to, and save time with products such as NextGen Healthcare’s mobile dictation, transcription, and remote scribe
• Increase workflow efficiency and the flexibility of a hands-free mobile app
• Complete an entire clinical viewing and reporting workflow without the need to exit and reopen the EHR
• Save time with image-enabled orthopedic integrated PACS

Improve the quality and efficiency of care delivery

• Streamline clinical workflows with specialty-specific and customizable content
• Manage the surgery scheduling process with workflow designed for the orthopedic practice
• Easily stay current with regulatory, documentation and compliance requirements
• Provide better care through integrated, mobile collaboration

Participate in frictionless interoperability

• Access and share patient information seamlessly through a national data exchange
• Remain independent and provide optimal care with cost-efficient interoperability 
• Access clinical data with easy-to-activate plug-and-play APIs for easy data exchange
• Consolidate data from disparate systems for a single source of truth across the community

Capture revenue at the lowest cost

• Provide a more informative and engaging check-in and billing experience
• Automate charge creation and create custom coding rules
• Maximize financial performance with clean claims and AR management
• Recover everything you’ve earned with customized, turnkey contract audit and recovery

Engage patients in their care and drive loyalty

• Improve patient engagement and decrease staff time on tedious tasks
• Deliver cost-effective and convenient care with virtual visits for appointments such as post op care
• Enhance patient and provider relations with secure messaging
• Enable efficient communication to patients with automated technology

Closing points to ponder

Healthcare is a competitive marketplace, and the right health IT vendor can help you with an EHR solution that incorporates processes and workflows to maximize efficiency. Today, patients are in the driver’s seat—solutions to improve the patient experience will strengthen your marketing efforts, while standardized, customized reporting solutions can free up your time for patient care. Lastly, 
seek solutions that help you increase your clean claims rate, reduce denials and better manage the revenue cycle.