autonomous practice under another ortho practice?

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myrandom2003

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There is a local ortho group that wants to bring me on, versus going out and hiring someone. We already have a mutual relationship and referral pattern of patients. I like my independence but also like the idea of having strength in numbers. They have one PMR guy that is in the twilight of his career and just wants to do lumbar ESI all day. If I do not join, they will go out and hire someone else. Not a threat, just a fact. They want to address a need in their practice.

So my questions are: do any of you that are partners in an ortho group, essentially run independently? How did you get that structured?

Ideally, they just absorb my LLC and I run the interventional spine/pain arm of the practice.
 
Will you have your own fluoro suite or will you have to do all your procedures at their ASC? What set up do you have now?

The PM&R guy wants to do lumbar ESI all day instead of what - stimulator trials? Pain prescriptions?
 
I do all my stuff now at the hospital but now but have an agreement with them so it financially makes sense for me. Essentially makes me whole as if doing in my office.

Not Independent contractor

If I joined this group, I would do everything in the ASC except Medicare injection which would be in office. I would be at 50% collections until a million, then partner and then take home all collections. Currently their DME, PT, and MRI covers the overhead for the partners in the practice and then a little extra the partners take home.

Currently I take home everything after overhead which comes out to about 37% actual practice expense. I also enjoy not having anyone looking over my shoulder. Partly why I am wondering if i can structure a way that i essentially have my own current private practice but under their corporate umbrella.

(Ideally, I would rather hire a partner but I don’t think financially it will be feasible for several months or a little longer).
 
Does PT and MRI count towards your collections? If not, it’s hard to reach a million in collections with office visits and pro fee for shots alone

Also…it’s really awkward to have a fluoro suite that only Medicare patients can use. The facility fee for your patients will give them a $500-$1000 mark up on your procedures. Then when they turn 65 you’re magically going to do the procedure for less in your office? You will look bad.
 
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myrandom2003 said:
I do all my stuff now at the hospital but now but have an agreement with them so it financially makes sense for me. Essentially makes me whole as if doing in my office.

Not Independent contractor

If I joined this group, I would do everything in the ASC except Medicare injection which would be in office. I would be at 50% collections until a million, then partner and then take home all collections. Currently their DME, PT, and MRI covers the overhead for the partners in the practice and then a little extra the partners take home.

Currently I take home everything after overhead which comes out to about 37% actual practice expense. I also enjoy not having anyone looking over my shoulder. Partly why I am wondering if i can structure a way that i essentially have my own current private practice but under their corporate umbrella.

(Ideally, I would rather hire a partner but I don’t think financially it will be feasible for several months or a little longer).
Click to expand...
If you are doing everything at the hospital, why is your overhead 37 percent?
 
myrandom2003 said:
I would be at 50% collections until a million, then partner and then take home all collections
Click to expand...
Not sure I understand. You mean it's 50% collections till 1M then 100% >1M? Or that after you collect 1M/yr you go from employed to partner?
 
The offer is 50% of collections but once I am generating $1mill in “receipts” then I get partnership and keep everything I generate even if that is below 1mil, plus any ancillaries.

I don’t even want all that. I just want to keep what I generate minus my overhead. I just like the idea of having spine ortho partners.

My overhead is about 37% because of all the startup costs this year (lawyers, furniture, office equipment, insurances, utilities, staff, rent, stuff for my home, etc)

Medicare doesn’t pay for any sedation so why do it in an ASC? I’m just saying that’s how the group has it setup now.
 
If this is a major referral source and that will dry up if you do not join then you are in a tough spot IMO.

I am solo PM&R physician (sports/spine/EMG) in an ortho group and know that I have extreme value to the practice because I am willing/able/happy to see all the spine/pain patients in addition some of the PM&R dump type stuff.

It sounds like you could be stepping into this role if the current ESI guy is phasing into retirement which can be pretty lucrative as long as you don't let yourself get screwed in the contracts - what you describes seems reasonable to me (but I am just one opinion).

If this group is not much of your referral base (<20%) then you probably are better off sticking to your current situation/autonomy and solidifying your relationships with other referral sources.
 
Short answer, there is no way for you to join a group and keep your overhead completely separate from theirs. Groups may be structured differently in what is considered a shared expense and what counts towards collections. You will have to ask them for more details, talk to the PM&R guy. Typically the only path to keeping 100% of profits is partnership and most groups are going to have a buy-in to become partner. The way you wrote it made it sound automatic, so I would clarify that. You can PM me if you have any questions about being a partner in an ortho group.
 
I’m in an Ortho group but it sounds like a different structure. A few thoughts: I was hired by the group so I wasn’t moving an existing practice - you would essentially be merging with them. They can talk about recruiting someone but ultimately that person would have to compete with you. You may be able to negotiate for them to buy your existing practice or give you some sort of credit toward the buy in/equity in the group.
I’m a partner now. I think being independent but part of the group would be difficult. To maintain a separate business you would have to rent space from them at fair market rate (otherwise that could be seen as a kickback for referrals), maintain your own staff and your own EMR. They probably won’t be interested in the administrative hassle of such an arrangement, and want the control of having you in the group.
Everything in the ASC except Medicare would make it very hard to reach $1M collections. You are in a unique position to figure that out though - just look at your current non-Medicare collections on the pro-fee, ignoring any payment from the hospital, and you’d then get to keep 50% of that. It’s a laughably small amount unless your practice is almost entirely Medicare. Talk to them about it though, since a lot of ASCs don’t make much if anything on injections. They might be fine with you just doing RF (and stim, kypho, etc, anything advanced) and keeping the injections in office.
Our PT and MRI turns out less than $15,000 per partner per year. I think long ago we had DME and stopped doing it. I don’t know why. If they are covering their entire overhead they must sell a lot of DME - will you be expected to prescribe back and neck braces to all of your patients?
Does the guy who is there do all the group’s chronic opioids? Some of those old guys are very comfortable with high opioid doses and not too careful about who they give it to. They won’t be up front about it either, but you can ask whether you would be expected to take on chronic opioids for failed surgical patients. I was very upfront with my group that I would not take on any chronic opioid management. Some grumbled but there’s a strong culture of non-interference such that no one felt they could force me into it even as an employee.
 
The more i read what is written here, the more I like my current situation.

I have been a partner in a large ortho group before (before i got married and had to move). It was a good situation. It was like 70 little private practices under one umbrella. But over head was essentially covered by our groups ortho hospital profits. (Hated leaving that place)
I am looking to see if that could be recreated or if any of you are in something similar.

At this current group, no opioid take over. They currently send their opioid patients to a different practice.

I didn’t know if there was a way to have my own P/L as a sub entity. Let the ortho guys do their thing and I do my thing.

The current pmr guy there does very little, not aggressive and not motivated from my impression. Only pressure I would have is to produce, doesn’t matter how it seems.
 
So if DME/ MRI are covering overhead plus some now, and adding you shouldn't be much more overhead, it should probably cover yours too.

Then you're keeping 100% pro fee? Sounds pretty good to me. I don't find it too hard to hit 1M pro fee. You should be able to do the math and see how your bottom line would change.
 
RoloTomassi said:
So if DME/ MRI are covering overhead plus some now, and adding you shouldn't be much more overhead, it should probably cover yours too.

Then you're keeping 100% pro fee? Sounds pretty good to me. I don't find it too hard to hit 1M pro fee. You should be able to do the math and see how your bottom line would change.
Click to expand...

Is the profee for a 64483 TFESI $111.50?

8969 epidurals will get you there. About 40 per day at 225 working days in a year.
 
lobelsteve said:

Is the profee for a 64483 TFESI $111.50?

8969 epidurals will get you there. About 40 per day at 225 working days in a year.
Click to expand...
3 clinic days, 30 pt/day, 90/wk:
90 x 150/(99204/99214) = $13,500/wk

2 procedure days, 25 procedures/day, 50/wk:
50 x 150/procedure (averaging a 1 level with 2 level/bilateral) = $7,500/wk

$21,000/wk x 48 wks = 1M

This is with Medicare. Throw in better payers, RFA/SCS/etc, and you can cut the above volume down and still make 1M pro fees.
 
Realizing we’re still missing a lot of details, but from you’ve presented, I think it warrants exploring deeper and having more conversations with the group. I’m a full partner in an Ortho group and while myself and the other pain docs practice independently (no opioid dumps), our finances are intertwined. It’s much simpler from an accounting perspective and fits the group’s collective mindset of a rising tide lifts all boats. That being said, there is definitely a way to do what you’re asking. We’ve been exploring mergers with other neighboring practices and had a consultant come to discuss the different ways those mergers can happen. You could merge with this group to come under the same tax ID for insurance contract benefits and strength in numbers but remain functionally independent. It just depends what you both want out of the merger. With the current climate trending toward consolidation and private equity dipping their nasty toes in the water, it sounds like an attractive opportunity. If they’re offering shares in their ASC and they have guys doing outpatient total joints, then it really becomes a no brainer.
 
myrandom2003 said:
There is a local ortho group that wants to bring me on, versus going out and hiring someone. We already have a mutual relationship and referral pattern of patients. I like my independence but also like the idea of having strength in numbers. They have one PMR guy that is in the twilight of his career and just wants to do lumbar ESI all day. If I do not join, they will go out and hire someone else. Not a threat, just a fact. They want to address a need in their practice.

So my questions are: do any of you that are partners in an ortho group, essentially run independently? How did you get that structured?

Ideally, they just absorb my LLC and I run the interventional spine/pain arm of the practice.
Click to expand...

They'll never love you back. See if you can be a "pop-up" in their department store or do a real estate project with them so you all have some skin in the same game. In exchange, you can give their patient's white-glove service and priority access.

In the long run, no one regrets staying independent.
 
What does a fair contract look like in an ortho group where partnership is not on the table and procedures are done at the ASC? Is this even worthwhile?
 
ED50 said:
What does a fair contract look like in an ortho group where partnership is not on the table and procedures are done at the ASC? Is this even worthwhile?
Click to expand...
An RVU pay basis would be the only way for it to make sense assuming you can’t buy in to the ASC. That way you could benefit some from the facility fees without actually getting paid facility fees.
 
ED50 said:
What does a fair contract look like in an ortho group where partnership is not on the table and procedures are done at the ASC? Is this even worthwhile?
Click to expand...
RVUs is a good way, evens out the playing field with payers if you plan on doing a lot of Medicaid or Medicare.

Another way is by collections, if you can trust them to be honest and transparent.

How much would you be happy making doing what they want you to do, type of patients, payer mix, locations, support staff, control or lack thereof, etc. Figure that out and work the math backwards on pro fees.

For example, ideally you have good payer mix so you don't have to do crazy volume, no opioids, reasonable commute, no obligations outside of 9-5, no skin in the game, good support staff. If you are happy with 750k, and the pro fees you think you can generate are 1M, ask for 75% pro fees. Or structure it differently, say 450k base, then 75% anything over 600k.
 
Slightly similar scenario - an established neurosurgery group with which I have a good working relationship is offering a Prof.Serv.Agrmnt ( provides EMR, RCM, access to their contracts & admin support) for 12% of gross collections of my entity - it will be a predominantly office based practice with only prof. fee from ASC/HOPD - worth it?
 
RoloTomassi said:
RVUs is a good way, evens out the playing field with payers if you plan on doing a lot of Medicaid or Medicare.

Another way is by collections, if you can trust them to be honest and transparent.

How much would you be happy making doing what they want you to do, type of patients, payer mix, locations, support staff, control or lack thereof, etc. Figure that out and work the math backwards on pro fees.

For example, ideally you have good payer mix so you don't have to do crazy volume, no opioids, reasonable commute, no obligations outside of 9-5, no skin in the game, good support staff. If you are happy with 750k, and the pro fees you think you can generate are 1M, ask for 75% pro fees. Or structure it differently, say 450k base, then 75% anything over 600k.
Click to expand...
I don’t know many ortho groups willing to pay that base or that percentage over collections. Maybe it’s geographical but that sounds very very generous
 
Analgesia108 said:
Slightly similar scenario - an established neurosurgery group with which I have a good working relationship is offering a Prof.Serv.Agrmnt ( provides EMR, RCM, access to their contracts & admin support) for 12% of gross collections of my entity - it will be a predominantly office based practice with only prof. fee from ASC/HOPD - worth it?
Click to expand...
Is there office based fluoroscopy suite?
You will lose money in any ASC unless you have shares.
 
Dr. Ice said:
I don’t know many ortho groups willing to pay that base or that percentage over collections. Maybe it’s geographical but that sounds very very generous
Click to expand...
Agreed. Exceedingly generous. For a partnership track, I’ve seen more like $250-300k base plus 25% of collections over $600k. For an employed position, you could negotiate up from there. Partnership productivity being 40-50% up to $800k collections, 50-70% over.
 
Not saying it's common but I have seen a couple similar. Look at OP, similar.

Smart orthos who own ASC will know how much pain brings in facility fees. They'll make a ton off you on the ASC, even if they break even on the office side.

Smarter orthos will profit off you on both sides. There's always enough pain docs willing to take that deal, so we're selling each other short.
 
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lobelsteve said:
Is there office based fluoroscopy suite?
You will lose money in any ASC unless you have shares.
Click to expand...
Yes, the office fluoro suite will be owned by my entity
There is no ASC owned by the neurosurgeons in the area, so I have to take high acuity procedures to the closest ASC/Hospital that is available and there I wd only make prof fee...
 
Analgesia108 said:
Slightly similar scenario - an established neurosurgery group with which I have a good working relationship is offering a Prof.Serv.Agrmnt ( provides EMR, RCM, access to their contracts & admin support) for 12% of gross collections of my entity - it will be a predominantly office based practice with only prof. fee from ASC/HOPD - worth it?
Click to expand...
No.
 
Analgesia108 said:
Yes, the office fluoro suite will be owned by my entity
There is no ASC owned by the neurosurgeons in the area, so I have to take high acuity procedures to the closest ASC/Hospital that is available and there I wd only make prof fee...
Click to expand...
So basically they are charging you 12% of your collections for "EMR, RCM, access to their contracts & admin support". What about rent, malpractice, etc?

You should be able to compare what they are willing to pay for to what 12% of your collections is now and have a sense of whether it's a good deal.
 
Currently going through such diligence. However, I am unsure of pros & cons of PSA for the long run. Wondering if anyone else has been operating under a PSA with a spine surgery group
 
A big determinant may be how good their fee schedule is compared to yours. It has been quite a while but a neurosurgeon told me that while everyone else was getting a haircut on fees they hadn't been touched due to the limited supply of neurosurgeons.
 
Another thing to consider is if you'll have a non-compete should things go south that would not allow you to return to previous setup.
 
Hi I'd love for some perspective on this situation:

I've been given an offer to be the first pain physician in an ortho practice with essentially 30-35% overhead (based on their scale). They are willing to let me do bread and butter in the office fluoro suite and RFA's, stim, etc. at the ASC. XR's and DME goes towards pro fees. They are asking that I do at least 1/2 day of EMG's. They are also promising ancillaries off MRI and facility fees after the initial period. Employed position.

Should I be asking for consideration for partnership in the future and/or buy-in on the ASC, especially when they are already promising ancillaries even as an employed physician? Or is it better to bring this up to them at the end of the initial contract period (2 years).
 
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Bring things you want now before you sign anything. Don't expect them to give you anything or change a sweet deal (for them) later on.

I'd definitely ask for ASC shares at least
 
Ducttape said:
Bring things you want now before you sign anything. Don't expect them to give you anything or change a sweet deal (for them) later on.

I'd definitely ask for ASC shares at least
Click to expand...
Thank you for the advice. I am a new graduate so this is all very helpful. I see where you are coming from for sure, but wanted to provide some more context to see if it would change anything.

They said that at the end of the 2 year contract, we would re-negotiate overhead and discuss ancillaries then. I am very interested in this job and would likely take it even if no partnership, especially since they are offering ancillaries in the future. I am worried that if I join, since there is no infrastructure for a pain physician yet and I would need to build that out, my productivity won't be very high in the first year. Additionally, as a new grad without a previous track record, I'm not sure how much leverage I have to negotiate partnership and/or ASC in the first contract without turning them off.

Since they have no prior concept of how much revenue pain can bring, is it better to just discuss partnership at the end of 2 years with data on how much I've produced for them?
 
pmr10 said:
Thank you for the advice. I am a new graduate so this is all very helpful. I see where you are coming from for sure, but wanted to provide some more context to see if it would change anything.

They said that at the end of the 2 year contract, we would re-negotiate overhead and discuss ancillaries then. I am very interested in this job and would likely take it even if no partnership, especially since they are offering ancillaries in the future. I am worried that if I join, since there is no infrastructure for a pain physician yet and I would need to build that out, my productivity won't be very high in the first year. Additionally, as a new grad without a previous track record, I'm not sure how much leverage I have to negotiate partnership and/or ASC in the first contract without turning them off.

Since they have no prior concept of how much revenue pain can bring, is it better to just discuss partnership at the end of 2 years with data on how much I've produced for them?
Click to expand...
make sure they know that you arent their opioid dump for the post-op patients.

your focus should be "spine"
 
SSdoc33 said:
make sure they know that you arent their opioid dump for the post-op patients.

your focus should be "spine"
Click to expand...
Thanks! Yes, they assured me that that I will not be managing post-op medications. They want me to build out my pain practice with my primary patient census, while also referring patients to me for interventions.
 
No offense...

there is a 50/50 chance they already anticipate hiring a new grad in 2 years. it seems oodles easier nowadays to hire a new grad than give up their own gains in making you partner.

I remain skeptical. everything seems to be in the future. and i get it, they want to feel you out to make sure they fit.

you should be able to set up a formula that ensures that you will be able to buy shares or become a partner in 2 years, before you sign.

regardless, have a lawyer review your contract before you sign.


also, dont lock yourself out of the area with a heinous non-compete clause that prevents you from up and leaving if they treat you poorly. leaving is not a bad thing - you should build up cash funds, get experience especially with billing, and then can open your own practice or buy doctodd's Miami paradise practice.
 
pmr10 said:
Hi I'd love for some perspective on this situation:

I've been given an offer to be the first pain physician in an ortho practice with essentially 30-35% overhead (based on their scale). They are willing to let me do bread and butter in the office fluoro suite and RFA's, stim, etc. at the ASC. XR's and DME goes towards pro fees. They are asking that I do at least 1/2 day of EMG's. They are also promising ancillaries off MRI and facility fees after the initial period. Employed position.

Should I be asking for consideration for partnership in the future and/or buy-in on the ASC, especially when they are already promising ancillaries even as an employed physician? Or is it better to bring this up to them at the end of the initial contract period (2 years).
Click to expand...

Congratulations! Work hard and make yourself indispensable to the group and you'll be prosperous and rewarded. The first two years are just dating. Don't come on too strong in the beginning. Learn to "read the room" and understand the inside baseline and interpersonal relationships. There is a lot to learn by watching.
 
drusso said:
Congratulations! Work hard and make yourself indispensable to the group and you'll be prosperous and rewarded. The first two years are just dating. Don't come on too strong in the beginning. Learn to "read the room" and understand the inside baseline and interpersonal relationships. There is a lot to learn by watching.
Click to expand...
They’ll never love you back.

Tons of private practice/KOL groups out there willing to chew up and spit out unsuspecting New grads. Don’t get me wrong, I like my private practice and the control I have as a partner, but there were plenty of jobs I looked at where it was obvious they were looking for grist for the mill.
 
callmeanesthesia said:
They’ll never love you back.

Tons of private practice/KOL groups out there willing to chew up and spit out unsuspecting New grads. Don’t get me wrong, I like my private practice and the control I have as a partner, but there were plenty of jobs I looked at where it was obvious they were looking for grist for the mill.
Click to expand...

It's true. They will never love you back.
 
drusso said:
It's true. They will never love you back.
Click to expand...
drusso said:
Congratulations! Work hard and make yourself indispensable to the group and you'll be prosperous and rewarded. The first two years are just dating. Don't come on too strong in the beginning. Learn to "read the room" and understand the inside baseline and interpersonal relationships. There is a lot to learn by watching.
Click to expand...
there is something unsettlingly incongruous between these 2 statements....
 
drusso said:
They only want you for one thing.

Click to expand...

And for that they give me no overhead, no staff, no work between 7A-4P, no weekends, no marketing.
And a 401k, 403b, pension plan, under $400mo for family health insurance with dental and vision.
Sure, there are times when patience is tested and lots of folks stirring the pot. Swallow that frustration and know I get paid more than most to deal with this.
 
lobelsteve said:
And for that they give me no overhead, no staff, no work between 7A-4P, no weekends, no marketing.
And a 401k, 403b, pension plan, under $400mo for family health insurance with dental and vision.
Sure, there are times when patience is tested and lots of folks stirring the pot. Swallow that frustration and know I get paid more than most to deal with this.
Click to expand...

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