David Dickerson, M.D. - American Academy of Orthopaedic Surgeons
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Transcript David Dickerson, M.D. - American Academy of Orthopaedic Surgeons
What is the Future of Orthopedics:
Hospital Employed vs Private
Practice
Kevin D. Plancher, M.D., M.S.
Associate Clinical Professor
Albert Einstein College of Medicine
AAOS Fall Meeting
October 10, 2012
Philadelphia, Pa
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Disclosures
Updated Sept 2012
The following relationships exist:
Item 1 Royalties from a company or supplier:
No Conflict Reported
Item 2 Speakers bureau/paid presentations for a company or supplier:
Linvatec
Item 3A Paid employee for a company or supplier:
No Conflict Reported
Item 3B Paid consultant for a company or supplier:
No Conflict Reported
Item 3C Unpaid consultant for a company or supplier:
Merck
Item 4 Stock or stock options in a company or supplier:
No Conflict Reported
Item 5 Research support from a company or supplier as a PI:
No Conflict Reported
Item 6 Other financial or material support from a company or supplier:
No Conflict Reported
Item 7 Royalties, financial or material support from publishers:
Saunders/Mosby-Elsevier; Thieme
Item 8 Medical/Orthopaedic publications editorial/governing board:
American Journal of Orthopedics,Techniques in Sports Medicine
Item 9 Board member/committee appointments for a society:
AAOS; American Orthopaedic Society for Sports Medicine; American Shoulder and Elbow
Surgeons; Arthroscopy Association of North America; International Society of Arthroscopy, Knee
Surgery, and Orthopaedic Sports Medicine
Personal Disclosure
Career Highlights
Medical School
Georgetown
Residency
Harvard Combined Program
Fellowships
Hand-Indiana Hand Center
Richard Hawkins/Richard Steadman
Full Time Faculty
Jim Strickland
Shoulder /Knee Sports Medicine
Henry Mankin/Clement Sledge/John Hall
1994-1999- Montefiore Medical Center/Albert Einstein College of Medicine
Private Practice
1999-2012 Academic Model
4 Partners
2 ACGME Sport Medicine Fellows
6 Station Cadaver Lab- Located 1 Floor Above Clinical Office
• Not For Profit- 501 C 3
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice vs Hospital Employed
Topics Covered
Common Ground
Malpractice
Staying Solo
Hospital Employed
Emotional Disadvantages For You
Financial Pro/Cons
Advantages From the Hospital
Perspective
Switching Practices
Hospital Traps
Emotional Advantages
Negotating Contracts/ Did You Know?
Coding
Starting A Private Practice
In-Network/Out of Network
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice Vs Hospital Employment
First Job-The Facebook Era
Ask The Correct Question!!!!
Which Job will Give Me the Right Mentor
The First Time For Doing an Operation
Great Senior Partners
Con Private Practice
Make quotas for Set Salary
Pro Private Practice
Good Chairman
Con Hospital
Watches You Grow
Pro Hospital
Something New Everyday
The Correct Program
Knowledge is Good
Experience is Limited
Judgement is Still Young
Pressure to Compete and Be Accepted
Ask The Correct Question!!!!
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice Vs Hospital Employment
15 Years Into Practice
Ask The Correct Question!!!!
Which Job will Continue to Let Me Grow
The Kids Are in School
Seems Easy- Just Show Up and Go Home
What Do I do with All My Patients
• Will They Follow My Practice
Pro Private Practice
They Aren’t Around As Much
Con Hospital
• They Don’t Want to Take Any Call
Pro Hospital
They Don’t Have the Same Work Ethic
The Older Partners
Is Medicine Safe For Me
I Don’t Like to Take Risks
The Younger Partners
Knowledge is Good
Experience is Good
Judgement is Good
No Change- I Know the Drill
Con Private Practice
Pressure to Compete
Working Longer Hours and Less Pay
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice Vs Hospital Employment
10 Years From Retirement
Ask The Correct Question!!!!
Which Job will to Let Me Retire
Knowledge is Excellent
Experience is Excellent
Judgement is Excellent
The Kids Are Out of School
I Want to Travel More / I Put in My Dues
Downsizing the House/ Less Costs
The Younger Partners
They Don’t Have Experience
Liability with All Their Complications
The Older Partners
I am it!!/ I Want My Buy Out!
Pro Hospital
Seems Like Easy Money
• Do Clinic and Just Show Up
Great Vacation Time
Con Hospital
None/ I am Done in a Few Years/ Why Not?
Pro Private Practice
I am the Boss Finally
Con Private Practice
Costs are way up
My Take home is So Much Less
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice vs Hospital Employment
What is Common –Success is Easy
Availablity
Yes –Always!
• Non-Displaced Radial Head
Fracture
- Never Send to the Office
- Grandma’s Pubic Ramus
Affability
Difficult These Days
• Administrators
• Nurse Managers
• Colleagues
Playing in the Sandbox
Ability
Cutting Edge Knowledge
• Community Guy
- Popular-Knowles Pins
• You Know Better-A Problem
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Orthopedic Surgeon Practice Setting:
9,400 Returned Practice Surveys
• Type of Practice
2004 2008 % Change
• Priv. Practice-Solo 25.8% 20.9% ↓ 19%
• Priv. Practice-Group 50.6% 44.3% ↓ 8.3%
Total Private Practice Groups & Solo = 65.2%
• Priv. Pract.-Multi sp. 7.3%
• Academic Practice 8.4%
• Hospital Employed 3.8%
8.3%
8.5%
6.7%
↑ 12.3%
↑ 1.2%
↑ 76%
AAOS NOW, December , 2009
Recent Trends in Practice Setting
Source AAOS Survey 2011
Practice Setting
2004
2006
2008
2010
%
Change
Solo-Private
25.8%
24%
20.9%
18.5%
28.2%
Group-Private
50.6%
48%
46.4%
45.3%
10.5%
Multi Specialty
7.0%
7.0%
8.3%
9.0%
28.6%
Academic
1%
2%
6.7%
3.6%
>200%
Hospital
Employment
2%
2%
6.7%
8.1%
>300%
AAOS ,Health Systems Committee:, 2011
Private Practice vs Hospital Employed
Where to Start/ All Jobs-Patients
Hospital Based-Patients
Con-Minimal Relationships
Pro-Minimal Relationships
Expectations Low
• PA/ Resident
• Middle of the Night
Private Practice-Patients
Pro- Strong Relationships
Con- High Expectations
Always Available
• Call Schedule Doesn’t matter
• Can’t Drink at a restaurant
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice vs Hospital Employed
Malpractice
Pro-Hospital Based
Don’t have to worry about it
Paid for but……
Con-Hospital Based
If you leave…? Tail
Do Have to worry about Type
Pro-Private Practice
Select the Type You Want
Decision About Lawyers
Occurrence vs Claims Made
Your Decision
Con-Private Practice
Cost is high
Games-New York State
• Berkshire Hathaway
Private Practice vs Hospital Employed
Advantages of Staying Solo
You are Your Own Boss..
PRICELESS!
Spend all Those Years to
Become an MD
Hospital Based
• Automomy Lost
Hire and Fire
Whomever You Want
Without Asking Anybody!!
Come and Go As You Like!!
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice vs Hospital Employed
Disadvantages of Staying Solo
You
Can Come and Go
As You Like………
As Long As You Have
Back-UP!!!!!!!
That’s the Catch!
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice vs Hospital Employed
Advantages of Hospital Employed
Employee or Business issues
No Concerns
No Overhead Expenses
Stable Income
For the Time Being –Steady Paycheck
Based Upon the Local Private Practitioners
Incomes
MGMA National Data.
Automatic Referral Patterns
Forced by CEO
Artificially Busy
Large Patient Base
• Not Yours
Ability to Encourage Hospital to Develop
a Subspecialty Orthopedic Department
ACO
Automatically Included
© Copyright 2012 Plancher Orthopaedics & Sports Medicine PLLC
Private Practice vs Hospital Employed
Advantages of Hospital Employed
Employee benefits
401K
Pension
Holidays
Time Off
Reimbursement
Contracts with Payors
No Worries
Malpractice
No Costs To You
Indirectly Effects Paycheck
Private Practice vs Hospital Employed
Disadvantages Hospital
Employed
Employee benefits
No Say
Large Patient Base
Payor Mix
No Ability to Share
Non-Compete
Enforceable
Medicaid
Limited Salary Potential
Ancillary Revenue
When or If They Change
50 Mile Radius
Control of Employees
None
Your Reputation
AAOS NOW, 5/2012
Private Practice vs Hospital Employed
Potential Disadvantages Hospital
Employed
Decision Making
Termination
Bureaucracy
Meeting Time-Lengthy
Without Cause
Forced Retirement Age
Contract Length
Short
3-5Years on Average
Call Schedule
Indentured Servant
Never Graduating
• Rigid CallSchedule
Kaiser
Orthopedics
Administration Does Not Understand How
Orthopedics Differs From Other Specialties
AAOS NOW, 5/2012
Private Practice vs Hospital Employed
Advantages to the Hospital for
Orthopedist Employment
Revenue Generator-HUGE
Ancillary Service Revenue
Generator-Huge
Estimated Between $2.3 to 2.4
Million/MD
In “Rural Exception Hospital” System
• Even Larger than Huge
Control the Orthopedic
Marketplace
Within the Community
Complete Loss of Autonomy
Private Practice vs Hospital Employed
Advantages to the Hospital for
Orthopedist Employment
Virtually,
NO DOWNSIDE
to Hospital Administration
Generating 4 to 6 Times Your Salary
But Tremendous Negotiating Ability
• Productivity bonuses
• Add Ancillary Staff
Help You Generate More Income
PA-C, NP’s, Administrative etc.
• Vacation time
PA-C’s Run Clinics for You
Salary Adjustment
Demand Productivity Based Not RVU
Private Practice vs Hospital Employed
Willingness to switch?
Ironically,
“Among Those Currently
Employed, 58% said they
would consider making the
move to private practice”
Yet,
58% in Private Practice Said
They Would Consider
Moving to Being Employed
Full-time!
Shapiro, AAOS Now, 11/2008
Schizophrenia
Private Practice
↑ Stress
Employed Physician
Private Practice vs Hospital Employed
Reasons for Leaving Private Practice
Decrease In Reimbursements
Difficulty in Practice Management
Ancillaries
Difficulty in Marketing
Match competition From Hospitals
Increase In Malpractice Insurance
Premiums
120K at 10 Years Claim Made
Physical Therapy, MRI etc.
Private Practionner NYC
Unwillingness to Provide
Uncompensated Care
Indentured Slavery
Lifestyle Issues
Work/Home Balance
Private Practice vs Hospital Employed
Being Flexible
Why Be Flexible
He Thinks He Has a
Problem
Often We as Physicians
Think We Have a
Problem With Our Job
Think Twice
Does He Have a
Problem –NO
Do You Have a
Problem??????
Private Practice vs Hospital Employed
Hospital Traps-Contracts
Beware of Non Competes
Carve Out Practices to Stay in
Town When Terminated
Avoid Claw Back Clauses
Salary That Is Returned
50 mile radius
When Productivity RVU Goals Are
Not Maintained
Remember The Hospital Does The
Collections
• No Incentive to collect or appeal
Need A Health Care Attorney
Language is Too Complicated
Production Formullas
Private Practice vs Hospital Employed
Hospital Negotiations-Contracts
Revenue-Know Your Worth
Know How Much You Earn
The HMO /Hospital
Surgery
Obtain 2 OR Rooms
Use As leverage:
• Higher Salary
• More Clinic Staff
Once or Twice/ week
Ancillary Help
1 or 2 PA’s In Clinic
Improve Your Efficiency
• “Quality of Life”
• Obtain an Administrative
Assistant
PA-C’s -1st call
Private Practice vs Hospital Employed
Hospital Traps-Olympic Time
Demand a Long Term Contract
10 Year Minimum
Termination Without Cause
Remove From Contract
Learn How to Say No!!!!!!!
To Administrators
To Lawyers
To Nurses Politely
To Patients
Earn Respect
You Sacrificed All Your Years of
Training
Wall Street Boys Start at Age 23
If Making Too Much Money
Must be Paid on a Productivity
Basis
You Start in your Mid 30’s
Stop Worrying!!!!!!!
Private Practice vs Hospital Employed
Hospital Contracts:
Define Outside Activities
Exclude From Hospital Ownership
IME’s
Depositions
Medical Record Reviews
Paid Quality Assurance Roles
Insurers
Any Paid Agreements
Implant companies,
Clinical advisor fees
Consultant Fees
Speaking Fees
Royalties
Private Practice vs Hospital Employed
Private Practice Traps
Formula Must Favor Productivity
No Equal Split
No 25% or 50% Split
Termination Without Cause
As You Age / Not Liked
The Higher of Which Always Favors
The Lower Producer.
The Group Wants to Get Rid of You
Require 100% Partner Agreement
Length to Partnership
Buy in For Ancillary Services
Easy in- Easy out
Minimal Buy In and Minimal Buy Out to
an Exiting Partner
• Avoid Owing Alot of Money to an Older
Partner On Retirement
Private Practice vs Hospital Employed
Contracts
Private Practice or Groups
New Laws-Practice Without
Walls Band Together
Join Other Soloists or Small
Groups
Form a Larger Group
Use the Umbrella Merger Concept
Attractive
Local Hospital System
ACO’s
• Will Be In Need of Orthopedic Coverage
Avoid
Fragmented System
May Entice the Hospital
• Hire Their Own Department
Private Practice vs Hospital Employed
Coding
Private Practice
Its Essential-Coding
Learn it in your Residency or
Fellowship
It’s a Game
Its Business
No Emotion
Consider Pro bono Work
Hospital Based
Keep Track of Your Billings
Lost Control of Appeals
Ways to Get Rid of a Doctor
Encourage Monthly Reports
Go to National Courses
Learn How to Code
Private Practice vs Hospital
Employment
Treading Lightly
The Other Side of the Classroom
Treat Others Well
Operating Room Environmental Service
Receptionists
• Boston vs. Indiana vs New York
• Take a Deep Breath
Two Ears, One Mouth
Even When You Are Right
• Senior Partners
Team Player
Even when Equipment is Outdated
Taking A Stand
Be Ready for No
• Be Ready to stand strong and walk out
• Wall Street Style
Athletic Trainers
Be Aware They Run the Show
Private Practice vs Hospital
Employment
Advice-Never Tread Lightly
Patient Advocate
Its You Against the World
Sit Down in an Exam Room
Dictate in the Room Never the
Hallway
It Will Secure Your Practice For Life
They hear you !!!!!
Physicians are Fickle
Send Referral Letters
Hospital Based
Forced to Refer to You
Private Practice
Referrals to Good Guys
• Not necessarily Best Trained
Focus on Patient to Patient
Any Conclusions?
(Too Early-Hold On)
Caught Your Attention?
• Have I Convinced
You to Think
Twice About
Hospital
Employment?
• Lets Look at
Private Practice
Establishing a Sound Business
Classic Medical Model
Where to Start-Private Practice
Know Your Neighborhood
Worry
Is There a Market For Your
Services?
Who Will Be Your Patients?
Who Are the Payors?
• Specific Insurances
In-Network
• Medicare
• Medicaid
Is My Overhead to High
Establishing a Sound Business Medical
Model
Resources
Question: How Do I Know What I Need to Get
Started?
•Ask Your Colleagues and Your Mentors
•Use Available Resources
•AAOS
(http://www3.aaos.org/member/prac_manag/prac_manage.cfm)
•AMA (http://www.ama-assn.org/ama/pub/physicianresources/solutions-managing-your-practice.shtml)
Establishing a Sound Business True
Business Model
Where to Start
Decide Where You Want to Live
Ignore Everything Else
Be Ready to Listen to Your Patients –
Customers
Nordstroms vs. K-Mart
Dictate in Front of Patients
• Seat Height
Participate in >1 Hospital ER
Never Be Held Hostage-BI North
Never Send to My Office
Out-Of-Network Insurance
Never Look at Someone Elses OR
Schedule-Worry About Yourself
Rarely If Ever Have Someone Cover For
You
I’ll Be Right In
Consider Being Both Academic and
Private Practice
Accepting
New
Patients
Establishing a Sound Business
True Business Model
Where to Start
Realize
There is Always Room for Another
Great Surgeon
Available
Available
Affable
Appropriate
24 hours/day
7 Days a Week
Be prepared to Miss School Functions
Be Prepared to Miss Family Birthdays
Be Prepared to Miss Parties
You Are a Physician!!!!!!!!!
Not a Stock Broker
• They Play for a Living
• You Practice for a Living!
Personal Sacrifice
Don’t Want it –That’s okay
• Hide in an HMO- 9-5 pm
Establishing a Sound Business Model
Private Practice
The Numbers
Budget-Design It
Indirect Expenses
Variable Expenses
• Direct Expenses
Obtain a Loan
Understand Your Cash Inflow
Office Visits
Surgical Procedures
• Are You an Orthopaedic Surgeon or an
Orthopaedist?
Ancillary Services-Beware of Stark
Laws
Establishing a Sound Business Model
Private Practice
In-Network vs. Out-of-Network
Out-of-Network
4 Times the Reimbursement
More Pro Bono Work
Common Myths
Can’t Do It In My Neighborhood
• Bronx NewYork
My Chairman Won’t Let Me
• Separate Tax ID Number
It is Doctor Driven
• Hospital
• Anesthesia
Emergency Room Visits-Love to Go
• By Law- Distal Radius $1500 vs.
$200
Paid By The Insurance Companies
Never Hurt the Patient
Establishing a Sound Business Model
Private Practice
In-Network vs. Out-of-Network
In-Network
EGO-Driven Doctor
Drop Plans When Financially Possible
9 Years
Periodic Evaluation
I Do 800 Cases a Year
• Are You Busy?
No• Actually I make 4x the Reimbusement and
Play Golf, Volunteer and See My Family .
• I Do 250 Cases a year and 25 Patients a Day
Instead of 50 in the Morning.
Are You Worth a 10 Dollar -25 Dollar Co-Pay?
Pare Out Slowly
Get a New Tax ID Number
It’s a Game –Be READY to PLAY
Everything is Negotionable
Establishing a Sound Business
Model
Marketing-Private Practice
Your Relationship With Your Patients IS Your
Business – Pay Attention to Them
Establish a Relationship
With the Community
Participate
Little League Coach etc.
School Functions
Meet Your Colleagues
Be Kind
Market Yourself
Don’t Offend Your Colleagues
What is Your Niche′?
Establishing a Sound Business
Model
Marketing-Private Practice
Your Relationship With Your Patients IS Your
Business – Pay Attention to Them
Announce Your Arrival
Referrals Will Get You
Started-Insurance Books
• 1 Year-To Be Included
Don’t Expect Another
Pediatrician or Internist to
Refer to You
• Arthroscopic Rotator Cuff
vs.Open Repair
Establishing a Sound Business
Model
Marketing
Advertise
Individuals
Internet
Show Your Face In
Offices/Hospital
Hospitals
Local Newspaper
Regional Newspaper
• Branding
HSS-New York Times
Hospital Newsletters
Establishing a Sound Business
Model
Staff/Associates
Surround Yourself With
Quality People
Office Manager/Assistant
Billing Staff-Ethical
Always Dictate Your Own
Operative Report
Accountant
Insurance Agent(s)
Banker
I.T.
Spend a Lot More to Get Quality Help
Know the Laws! Never Break Them!
Establishing a Sound Business
Model
Keys to Success
Be Humble
Put Away Your Pride
Don’t Be Afraid to Work
Pound the Pavement
Lectures to
•
•
•
•
Publish Papers
Be an Authority
Private Practice Experience
Always Say “YES”
Senior Citizen Groups
Athletic Trainers
Physical Therapy Groups
Hospital Grand Rounds
Be Available
Avoid Being Cheap
Most Doctors Are!
Establishing a Sound Business Model
Classic Medical Model
Earn
Before
You
Spend!
Private Practice vs Hospital
Employment
How Much Do You Get
Arthroscopy Shoulder
Labral Repair
Rotator Cuff Repair
ACL
In
Out
Total Joint
Total Knee Replacement
In
Out
Arthroscopy Knee
In
Out
In
Out
Hospital
Trauma
ORIF Radius-Gallezzi
Surgeon
Hospital
Private Practice vs Hospital
Employment
How Much Do You Get
Arthroscopy Shoulder
Labral Repair
Rotator Cuff Repair
ACL
In-$1,081
Out-$8,000
Total Joint
Total Knee Replacement
In-$1200
Out-$9500
Arthroscopy Knee
In -$850
Out-$8,500
In-1,600
Out-10,000
Hospital 65K
Trauma
ORIF Radius-Gallezzi
Surgeon-$750.00
Hospital-39K
Private Practice vs Hospital
Employment
How Much Do You Get
Don’t Ever Apologize!
The Enemy
The Insurance Company
• For Profit
• Stock Must Go up
The Hospital
• Re-imbursed almost double for
same procedure as a surgery
Center
Lobbies
Get Mad-Make a Difference
The public
Surverys of Educated College gradsNew York Times-Doctors are
underpaid
Establishing a Sound Business
Model
Classic Business Model
Spend and Invest In
Your Future
Wisely!
Stop Worrying!
Focus on Your
Patients!
© Copyright 2011 Plancher Orthopaedics & Sports Medicine PLLC
Thank You
If You Build It They Will Come!!!!
Did You Know!
• Being a hospital employee allows for involvement
in the capitation or ACO process
• You are the one bringing patient volume
• Orthopedics is the most lucrative surgical
subspecialty next to CV surgery reimbursements
• You bring in anywhere between 4 to 6 times your
salary net to the hospital
• Don’t ever forget to remind them of this fact !
• Don’t Apologize when Negotiating