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Lean and efficient operations are one aspect of a thriving practice. Another is finding new sources of revenue. The first areas of opportunity are logical extensions of a specialty: rehabilitation programs for orthopedists, cardiac rehabilitation and stress testing for cardiologists, hearing aids for otolaryngologists, and the like. “Almost all physicians can answer within their specialty and service mix what they could be doing but aren’t,” says Cameron. Relatively low-cost and easy-to-operate examples appropriate for many specialties include EKG testing and bone densitometry.

Many practice extension activities are covered by insurance and come with all the resulting documentation and billing requirements. But a growing number are not recognized by payers, and represent golden opportunities to bring in cold hard cash without bureaucratic rigmarole. They also happen to be well-suited to a number of specialties. Julio Garcia, MD, a plastic surgeon in Las Vegas, operates Ageless Forever, a wellness center that offers services ranging from nutritional counseling and body-fat analysis to blood and saliva testing to check vitamin and hormone levels. “As a plastic surgeon, I have an advantage in that patients are used to coming to me for luxury services and I already do ‘youthafying’ procedures like botox injections and skin treatments. But this is something any practice can pursue. Other physicians can learn how to do the ancillary procedures,” he says. Ageless Forever has been in operation since 1998; according to Garcia it requires about 10 percent of his time but generates about 25 percent of his income.

Primary Care Partners also offers skin care treatments like microdermabrasion. “It’s done by one of our female physicians. It blew my partners’ minds at first, but she understood and then they got it,” says Shenkel. The practice “is looking fairly aggressively at additional services it can provide consistent with our core values that are part of a comprehensive family practice,” he says.

Six years ago, the group saw such an opportunity in an after-hours clinic. Started modestly to limit up-front staffing costs, it now sees about 14,000 patients annually. The clinic is a real bargain over emergency care for insurers, and Primary Care Partners was able to parlay that into negotiating facility fees and, in at least one instance, higher reimbursement for claims submitted with an after-hours modifier.

Specialists—particularly those treating chronic diseases—will do well to simplify practice for generalists as much as possible. “In lean times, you have to develop a medical care system that fits into the fabric of the health-care system. You have to work with primary care practitioners and teach them what they can do in their practices,” says ProCare’s Davis. In the field of pain management for example, an estimated 20 percent of the under-65 population has chronic pain. The percentage doubles for patients age 65 and older and doubles again for nursing home patients. “We can’t expect specialty physicians to do it all. We have to teach primary care practitioners to do the bulk of the treatment,” he says. ProCare has developed a series of tools to help PCPs screen patients and provide better treatment by, for example, identifying the most cost-effective interventions. According to Davis, the model would work well for other specialists dealing with highly prevalent chronic conditions, such as endocrinologists and type 2 diabetes and cardiologists and congestive heart failure.

Whatever the initiative, one of the keys to success is merging physician interests with patient demands. Some services, such as laboratory and x-ray, pretty much run themselves after start-up and don’t require a lot of ongoing physician time. Others, though, like cosmetic procedures and disease management services, are highly dependent on the physician’s active participation. In those instances, it pays to “start where you already have a personal interest, so it’s not a chore to do the extra reading and research,” advises Garcia. Another suggestion: Start on a small scale and build gradually on success. “Come in, do a slice, do it well, then expand,” he says.

Support staff also have a critical role in launching any new service. “They’re your eyes and ears to the market. You may have an idea what you want for the practice, but they work with patients and know what they want,” says Cameron.

If a new service isn’t making the grade, don’t hesitate to make changes or pull the plug. Primary Care Partners made several stabs before it found the winning formula for its after hours clinic. Rager says ENTAA Care learned about the vagaries of retailing. “We tried selling hearing devices like pocket talkers and telephone devices. We never sold one. There are certain things people will buy from a doctor, and others not.”

Working the other side of revenue generation—increased reimbursement—often seems like a loosing battle, but there are ways providers can fight back. Both Primary Care Partners in Colorado and Summit Medical Group in Tennessee came into being as a means of raising the clout of what in each case had been several smaller groups. “If we weren’t together, we’d be behind the curve and not able to determine our own destiny,” says Summit’s Leahy. Since the practice cares for about 40 percent of Knoxville’s residents, it has the ear of insurers and has been able to negotiate better rates than the individual practices did prior to the group’s creation in 1995.

Meanwhile, ProCare and Primary Care Partners have both learned that payers are willing to pay for cost savings and better outcomes. Demonstrating cost savings over hospital-based pain management played to ProCare’s benefit, while Primary Care Partners’ lower emergency and hospital utilization compared to that of other family practices in the surrounding county have lead to higher reimbursement.

Another possibility is opting out of insurance by becoming a non-participating provider. This generally enables a practice to charge more and deal less with insurance, but it may work better in certain circumstances than others. “We’ve thought about it, but it’s not realistic for us. We don’t want any referring physician to wonder whether we’ll accept some patients but not others,” says Rager.

A small but growing number of providers are exploring what is variously called retainer practice, membership medicine, or concierge care. The models vary, but generally work off the same theme. Patients pay monthly or annual fees for services not generally recognized by third-party payers, enabling physicians to reduce their patient panels by as much as 90 percent while maintaining or increasing income. It’s an admittedly radical approach. “I did it out of desperation because I was prepared to stop being a doctor, and that was my passion,” says Robert Cava, MD, an internist and owner of Miami Medical Consultants. “I had a practice model that wasn’t viable in a managed care environment.”

Cava charges a retainer of $1,500 to $3,000 annually depending on a patient’s age. It recognizes “my reputation, credentials, and the confidence people have in me,” he says. He also bills insurers for covered services. The move cut Cava’s patient panel down from about 3,000 to approximately 350, with 250 patients in the retainer program and another 100 low-income paying reduced fee-for-service.

The approach has been a financial success and professional triumph for Cava. “I’m making a reasonable living and attending a spectrum of disease I’m more interested in,” he says.

Whether by a radical move or incremental changes along the way, every practice can find the formula to thrive despite challenging times. With patients at the forefront, the pathway is always clear. As Leahy puts it, “patients are the essence. We have to honor them and move in that direction.” n

If your practice is in the doldrums, you don’t necessarily have to hire an outside expert to spice up things. “The first and most important step is to admit you have a systemic problem in the business,” says Rick Cameron, a senior manager at Cejka Consulting in St. Louis. Clues come from everyday indicators: cash flow, accounts receivable balances, patient volume. But don’t overlook things like patient waiting times, appointment no-show rates, and employee turnover.

From the evidence, identify the top three to five reasons you believe your practice is not performing up to snuff, then dig beneath the surface to find the underlying causes. If cash flow is down and accounts receivable balances are up, is it because you’re not filing claims electronically or because you have a high rate of denials?

Next, implement a change that you believe will improve the situation. Finally, and most importantly, give the solution(s) time to work and then see what impact they’re actually having. “A lot of people don’t do this, but you need to double-check to see if the improvement is having a lasting effect,” says Cameron. n

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