Generating Non Surgical Income John R. Corsetti,

Transcript:Generating Non Surgical Income John R. Corsetti,:
Generating Non Surgical Income John R. Corsetti, M.D. New England Orthopedic Surgeons Springfield, MA Disclosure I have nothing to disclose Goals of Presentation Convey the importance of creating ancillary streams of revenue Outline the most commonly used ancillary lines Raise awareness that not all ancillaries work in all practices Use 4 common ancillaries to demonstrate the process Heighten awareness that private practice viability is increasingly dependent on ancillary revenue streams. Take Home: Ancillary revenue is vital to the success of orthopedic surgery practices today, but planning and execution must be done precisely, or a potentially long term negative cash flow situation can be created. 4 Ancillaries to Discuss Physician Assistants/Extenders Personnel, group based Ambulatory Surgery Center Hospital JV v. Group Medical Legal Individual Physical Therapy Service, group based Decisions, decisions…… Physical Therapy Surgery Center (ASC) DME Co-management Agreement Urgent Care Center On Call Compensation Physician “Extenders” Medical Legal MRI/Ultrasound ORTHOPEDIC SURGICAL PRACTICE Ancillary Revenue Lines Separate businesses from orthopedic surgical practice, about which you know very little as a physician. Ancillary must meet need for highest quality, uncompromised patient care FIRST Theory: Physician managed patient care is, in general, better run, more efficient, more profitable, and is associated with better patient satisfaction and perhaps outcomes than large organization managed patient care. What is Ancillary Revenue Money earned by the creation of lines of business outside of the core practice of orthopedic surgery, defined as the billing for services provided by a physician for patient care provided in either the office or operating room settings. Passive v. Active Income Doctors are “piece workers” Time is limited, and efficiencies can only be pushed so far Active Income: revenue generated by the active participation of a physician. Is limited by hours worked and efficiencies of workplace Passive Income: revenue that does not require the “active” involvement of the beneficiary, from activities that are outside of the “core” purpose of the beneficiary. Independent of hours worked, patients seen, surgeries done The “Death and Taxes” of Medicine Reimbursements Decrease $$ while Overhead Increases $$ Why is Ancillary Revenue Important? Form of “income diversification” Hedge against the vagaries of reimbursement Income is potentially scalable (“proportional growth”) Recruitment and retention of high quality doctors Insulation from inevitable production variability (group and individual) Allows for physician control of patient care Ancillary Revenue Trend 1995 5% of total income 2015 40% of total income Note: employed physician (v. private