Pain Management in Ortho Practice

[BlockJock]

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Long time lurker, first time poster. I am currently looking for some advice on my current position in an orthopedic group and my next steps going forward

Currently, I am in a VHCOL area. I am finishing up on two years at this current practice, with this being my first job out of fellowship

My initial contract structure is a base pay (300k) with 40% of professional fee collections > 650K. Not eligible for partnership. Fortunately, I have been able to be fairly productive with yr 1 collections around 1.2, and for year 2 probably close to 1.7m. Office based procedures and a budding advanced portfolio with SCS, PNS, TDD, small amount of kypho's, and a low volume of WC. For context, my practice has had several pain docs in the past who have all left and had very bread/butter practices. I have started to do my own implants in an ASC. My group does not own the ASC, but I would be able to get shares in the ASC, keeping in mind this is in a CON state

There certainly are many pros to this job. I have a high volume of patients and the ortho's don't really tell me what to do. I currently go to 2 offices out of 4

The big issue that I am running into is that I feel as if my income should maybe be closer to an extra 100k, for the volume that I'm producing. I had negotiated with my practice and they had increased my collections by an additional 2%. I have two major problems with this current contract. 1) I am paying close to a 1m in overhead, when some of the senior partners in the group don't even collect a million in total collections and 2) the more productive I become, the less percentage of money I keep with how my contract is structured. When I had pressed them on this, their counterargument is that 1) they provide the patients and 2) since I am in the office more than them as they go top operate, I am using more resources and subsequently should be paying the highest in terms of rent and into employee costs. As part of my negotiations, they had told me that they would actually lose money on me if they gave me a higher percentage of collections which sound ludicrous to me

I know the overhead of an ortho group is fat, but I feel as if I am heavily subsidizing the overhead for the less lucrative partners. Although I am not privy to all of these details, my understanding is that the profit sharing is done equally among the partners including XR, PT, DME. There is also some equity component in 50% of the offices. I currently generate around 70k in XR costs, contribute to the in house PT, and do not really order too much DME

So I am a little confused on what my next steps should be and whether my thinking that Im getting a raw deal is even justified

1) I stick it out, knowing that I can make good money, while still working like a dog and hope to renegotiate again in the future. My concern with this is the proposed CMS cuts to joint reimbursements and same day injections and the knowledge that I will most likely be expected to carry more of the overhead as joints reimbursements decreases. The other caveat to this is that year one I was the only pain doctor and for year 2 they had hired another doctor, who has not been able to be busy. This obviously has cut my volume by about 100-200 encounters a month. Now this second pain doc is generally unhappy and is looking to leave for another job. If I once again become a solo doc, I would potentially be drawing in volume. Now I think it's unlikely that the group would not look to hire another pain doc, even though the volume is not really there as they want to have at least 2 docs in each service line. In addition to this, if a mid level was hire, I am not eligible to profit off their collections and probably would have to use them as a fellow and sign off on their notes to maximize this potential

2) I shop around my area for a better gig. I think that this potentially would be tough from a volume standpoint. From talking to my friends, it seems like a take home of 45-55% is reasonable from a collections standpoint. If I was able to get a new contract, hopefully would give me some leverage to negotiate again with my current group as well. HOPD jobs around me are generally not that good and I think they would not be able to accommodate my level of ambition and desire to hustle.

3) I leave my current market and look elsewhere. I have no ties and no other people to really consider when looking elsewhere, but if I was to relocate, I would really only be interested in areas where I have close friends, which they have concentrated into 1 or 2 markets. If I stay in my current area, I think that I have the potential to make a name for myself and do very well versus if I leave for another market I would be another guy. To be honest, I am more concerned with compensation than "being the number one guy" in any given area

4) I start my own practice in my current market. Fortunately, I have a pretty limited non compete and it historically has not benefited enforced at all. There are a couple things that concern me about this. 1) I think my current practice has good contracts with insurance companies and I don't think that I would be able to match this as a solo provider. 2) My market is currently dominated by Ortho Spine, who all work in large orthopedic groups with existing pain doctors. I think it could potentially be challenging to find a good referring spine surgeon in this type of setting and may lead to more primary care referrals, which may be a less interventional population. I also think after only working for two years, I probably do not have that much reputation around town to lead a rapidly growing private practice

TLDR
- In ortho group with high overhead, not feeling fairly compensated, and curious on what to do next

 

[Agast]

They have a track record of pain doctors continuously leaving and replacing them quickly. I don’t think they care if/when you leave. It’s much easier to strike out for a new start when you’re relatively young and don’t have family obligations tying you down so if you’re 50-50 on the fence I would say Leave. In general don’t accept a private practice job where Partnership isn’t explicitly in the contract.

 

[powermd]

GPT is your friend here:

He should treat this as a leverage problem, not an accounting debate.

1. Stop arguing about “overhead.” The owners can allocate overhead however they want, and they have no incentive to validate an analysis that shows he is highly profitable. Whether their accounting is intellectually fair is almost beside the point.
2. Figure out his own economics privately. At roughly $1.7M in collections and ~$740K compensation, the group retains about $960K before expenses, plus whatever ancillary value he generates through X-ray, PT, DME, referrals, and downstream procedures. He should estimate realistic direct costs and shared overhead so he knows roughly how much profit he is creating.
3. Determine his market value. Quietly shop comparable jobs in his current market and the few markets where he would actually consider moving. He needs real offers or at least credible compensation data, not anecdotes about what “45–55%” should be.
4. Model the solo-practice alternative. He does not necessarily need to leave, but he should understand what $1.2M, $1.5M, or $1.7M of collections would look like after billing, staffing, rent, malpractice, supplies, payer discounts, and startup costs. That gives him another benchmark for what staying is worth.
5. Value the current platform appropriately. The present job has real advantages: abundant referrals, autonomy, advanced procedures, ASC access, and potentially ASC ownership. Those are worth accepting some discount versus independence. The question is whether that discount is $50K, $100K, or several hundred thousand a year.
6. Then negotiate from alternatives, not fairness. The conversation should essentially be: “I like it here and would prefer to stay. At my current productivity, however, the economics no longer work for me. I need X structure to remain.” A straight percentage around the high-40s/50% range, a better marginal rate above a threshold, partnership, or ancillary participation are all more sensible structures than endlessly tweaking his current bonus.

Most importantly, he shouldn't threaten to leave until he is genuinely prepared to do it. His strongest bargaining chip is not proving that their overhead allocation is bogus. It's making them confront what happens when a physician producing $1.7M in professional collections walks out the door.


If they respond with “this is how it is, take it or leave it,” that's actually useful information. At that point he stops negotiating and decides whether the value of the platform justifies the price they're charging him to use it.

 

[Agast]

Move to Oregon and join drusso if you have good hustle

 

[callmeanesthesia]

Ortho groups have notoriously high overhead. I’m in one, as an equal partner, and that’s probably about what ours is.

Sounds like with your goals your best bet is you need to analyze your pay pattern and figure out how to game the system. That requires no negotiation or risk on your part. If you negotiate for one thing, make it for a piece of the mid level’s productivity since you’ll be doing the supervising. Even if not though, with in-office procedures you make far more per unit time doing injections than follow ups.

In private practice (ie non-wRVU model) very few things in medicine reimburse as much as a busy spinal injection day.

Advanced procedures are good marketing but not great per unit time, except for in office SCS trial and kypho. Drop pumps entirely unless there’s a really compelling reason for you to donate your time like that. For SCS if you have a neurosurg partner who likes to do implants, you could even refer to them unless there’s a compelling reason for perc leads. They’ll be happy with the implants and you’ll make $1000 or so per trial in office after expenses.

Alternatively, if you have an ASC that will give you shares based on just your advanced procedure volume without requiring you to bring 30% of your RFs there too, but in there for as much as they’ll let you. Do your stim implants there. Intracept also pays well for ASCs. You could also ask for an overhead break on ASC based income since they’re arguing you should pay more due to office utilization.

 

[RoloTomassi]

I would negotiate if they could add tier(s) to your current formula. 40% >650, then 50% > 1 M, etc. This is a strong argument because your overhead plateus and it shouldn't remain a fixed 60%. It's a win-win because you are incentivized to work harder. You have to be willing to leave to have leverage.

I do think you need to change your perspective though. A lot of what you are getting at is fairness. The partners' collections, compensation don't matter. You didn't take the risk to get there. You didn't sign up with that expectation either, so they aren't screwing you out of partnership. Even with your current formula, you could've done the math from day 1 and known what the split would be at 1.2M, 1.7M so you need to check your perspective that somehow now things are unfair and you are entitled to more despite agreeing to those terms.

 

[Taus]

I would negotiate if they could add tier(s) to your current formula. 40% >650, then 50% > 1 M, etc. This is a strong argument because your overhead plateus and it shouldn't remain a fixed 60%. It's a win-win because you are incentivized to work harder. You have to be willing to leave to have leverage.

I do think you need to change your perspective though. A lot of what you are getting at is fairness. The partners' collections, compensation don't matter. You didn't take the risk to get there. You didn't sign up with that expectation either, so they aren't screwing you out of partnership. Even with your current formula, you could've done the math from day 1 and known what the split would be at 1.2M, 1.7M so you need to check your perspective that somehow now things are unfair and you are entitled to more despite agreeing to those terms.

This. Tiered bonus structure.

 

[mdo1738]

Yeah I’m not sure the exact numbers at all but at some point of collections, your percentages should jump significantly. In your first $500k or whatever, it’s very reasonable for them to charge a higher overhead. But at a certain point, you have paid off your fixed charges and your only costs are the variable costs (needles, steroid, etc). Rent, staff salaries, etc don’t change their overall cost just because you collect $2 mill instead of $1 mill.

 

[mille125]

Long time lurker, first time poster. I am currently looking for some advice on my current position in an orthopedic group and my next steps going forward

Currently, I am in a VHCOL area. I am finishing up on two years at this current practice, with this being my first job out of fellowship

My initial contract structure is a base pay (300k) with 40% of professional fee collections > 650K. Not eligible for partnership. Fortunately, I have been able to be fairly productive with yr 1 collections around 1.2, and for year 2 probably close to 1.7m. Office based procedures and a budding advanced portfolio with SCS, PNS, TDD, small amount of kypho's, and a low volume of WC. For context, my practice has had several pain docs in the past who have all left and had very bread/butter practices. I have started to do my own implants in an ASC. My group does not own the ASC, but I would be able to get shares in the ASC, keeping in mind this is in a CON state

There certainly are many pros to this job. I have a high volume of patients and the ortho's don't really tell me what to do. I currently go to 2 offices out of 4

The big issue that I am running into is that I feel as if my income should maybe be closer to an extra 100k, for the volume that I'm producing. I had negotiated with my practice and they had increased my collections by an additional 2%. I have two major problems with this current contract. 1) I am paying close to a 1m in overhead, when some of the senior partners in the group don't even collect a million in total collections and 2) the more productive I become, the less percentage of money I keep with how my contract is structured. When I had pressed them on this, their counterargument is that 1) they provide the patients and 2) since I am in the office more than them as they go top operate, I am using more resources and subsequently should be paying the highest in terms of rent and into employee costs. As part of my negotiations, they had told me that they would actually lose money on me if they gave me a higher percentage of collections which sound ludicrous to me

I know the overhead of an ortho group is fat, but I feel as if I am heavily subsidizing the overhead for the less lucrative partners. Although I am not privy to all of these details, my understanding is that the profit sharing is done equally among the partners including XR, PT, DME. There is also some equity component in 50% of the offices. I currently generate around 70k in XR costs, contribute to the in house PT, and do not really order too much DME

So I am a little confused on what my next steps should be and whether my thinking that Im getting a raw deal is even justified

1) I stick it out, knowing that I can make good money, while still working like a dog and hope to renegotiate again in the future. My concern with this is the proposed CMS cuts to joint reimbursements and same day injections and the knowledge that I will most likely be expected to carry more of the overhead as joints reimbursements decreases. The other caveat to this is that year one I was the only pain doctor and for year 2 they had hired another doctor, who has not been able to be busy. This obviously has cut my volume by about 100-200 encounters a month. Now this second pain doc is generally unhappy and is looking to leave for another job. If I once again become a solo doc, I would potentially be drawing in volume. Now I think it's unlikely that the group would not look to hire another pain doc, even though the volume is not really there as they want to have at least 2 docs in each service line. In addition to this, if a mid level was hire, I am not eligible to profit off their collections and probably would have to use them as a fellow and sign off on their notes to maximize this potential

2) I shop around my area for a better gig. I think that this potentially would be tough from a volume standpoint. From talking to my friends, it seems like a take home of 45-55% is reasonable from a collections standpoint. If I was able to get a new contract, hopefully would give me some leverage to negotiate again with my current group as well. HOPD jobs around me are generally not that good and I think they would not be able to accommodate my level of ambition and desire to hustle.

3) I leave my current market and look elsewhere. I have no ties and no other people to really consider when looking elsewhere, but if I was to relocate, I would really only be interested in areas where I have close friends, which they have concentrated into 1 or 2 markets. If I stay in my current area, I think that I have the potential to make a name for myself and do very well versus if I leave for another market I would be another guy. To be honest, I am more concerned with compensation than "being the number one guy" in any given area

4) I start my own practice in my current market. Fortunately, I have a pretty limited non compete and it historically has not benefited enforced at all. There are a couple things that concern me about this. 1) I think my current practice has good contracts with insurance companies and I don't think that I would be able to match this as a solo provider. 2) My market is currently dominated by Ortho Spine, who all work in large orthopedic groups with existing pain doctors. I think it could potentially be challenging to find a good referring spine surgeon in this type of setting and may lead to more primary care referrals, which may be a less interventional population. I also think after only working for two years, I probably do not have that much reputation around town to lead a rapidly growing private practice

TLDR
- In ortho group with high overhead, not feeling fairly compensated, and curious on what to do next

Suggest a switch to an RVU model

 

[drusso]

Long time lurker, first time poster. I am currently looking for some advice on my current position in an orthopedic group and my next steps going forward

Currently, I am in a VHCOL area. I am finishing up on two years at this current practice, with this being my first job out of fellowship

My initial contract structure is a base pay (300k) with 40% of professional fee collections > 650K. Not eligible for partnership. Fortunately, I have been able to be fairly productive with yr 1 collections around 1.2, and for year 2 probably close to 1.7m. Office based procedures and a budding advanced portfolio with SCS, PNS, TDD, small amount of kypho's, and a low volume of WC. For context, my practice has had several pain docs in the past who have all left and had very bread/butter practices. I have started to do my own implants in an ASC. My group does not own the ASC, but I would be able to get shares in the ASC, keeping in mind this is in a CON state

There certainly are many pros to this job. I have a high volume of patients and the ortho's don't really tell me what to do. I currently go to 2 offices out of 4

The big issue that I am running into is that I feel as if my income should maybe be closer to an extra 100k, for the volume that I'm producing. I had negotiated with my practice and they had increased my collections by an additional 2%. I have two major problems with this current contract. 1) I am paying close to a 1m in overhead, when some of the senior partners in the group don't even collect a million in total collections and 2) the more productive I become, the less percentage of money I keep with how my contract is structured. When I had pressed them on this, their counterargument is that 1) they provide the patients and 2) since I am in the office more than them as they go top operate, I am using more resources and subsequently should be paying the highest in terms of rent and into employee costs. As part of my negotiations, they had told me that they would actually lose money on me if they gave me a higher percentage of collections which sound ludicrous to me

I know the overhead of an ortho group is fat, but I feel as if I am heavily subsidizing the overhead for the less lucrative partners. Although I am not privy to all of these details, my understanding is that the profit sharing is done equally among the partners including XR, PT, DME. There is also some equity component in 50% of the offices. I currently generate around 70k in XR costs, contribute to the in house PT, and do not really order too much DME

So I am a little confused on what my next steps should be and whether my thinking that Im getting a raw deal is even justified

1) I stick it out, knowing that I can make good money, while still working like a dog and hope to renegotiate again in the future. My concern with this is the proposed CMS cuts to joint reimbursements and same day injections and the knowledge that I will most likely be expected to carry more of the overhead as joints reimbursements decreases. The other caveat to this is that year one I was the only pain doctor and for year 2 they had hired another doctor, who has not been able to be busy. This obviously has cut my volume by about 100-200 encounters a month. Now this second pain doc is generally unhappy and is looking to leave for another job. If I once again become a solo doc, I would potentially be drawing in volume. Now I think it's unlikely that the group would not look to hire another pain doc, even though the volume is not really there as they want to have at least 2 docs in each service line. In addition to this, if a mid level was hire, I am not eligible to profit off their collections and probably would have to use them as a fellow and sign off on their notes to maximize this potential

2) I shop around my area for a better gig. I think that this potentially would be tough from a volume standpoint. From talking to my friends, it seems like a take home of 45-55% is reasonable from a collections standpoint. If I was able to get a new contract, hopefully would give me some leverage to negotiate again with my current group as well. HOPD jobs around me are generally not that good and I think they would not be able to accommodate my level of ambition and desire to hustle.

3) I leave my current market and look elsewhere. I have no ties and no other people to really consider when looking elsewhere, but if I was to relocate, I would really only be interested in areas where I have close friends, which they have concentrated into 1 or 2 markets. If I stay in my current area, I think that I have the potential to make a name for myself and do very well versus if I leave for another market I would be another guy. To be honest, I am more concerned with compensation than "being the number one guy" in any given area

4) I start my own practice in my current market. Fortunately, I have a pretty limited non compete and it historically has not benefited enforced at all. There are a couple things that concern me about this. 1) I think my current practice has good contracts with insurance companies and I don't think that I would be able to match this as a solo provider. 2) My market is currently dominated by Ortho Spine, who all work in large orthopedic groups with existing pain doctors. I think it could potentially be challenging to find a good referring spine surgeon in this type of setting and may lead to more primary care referrals, which may be a less interventional population. I also think after only working for two years, I probably do not have that much reputation around town to lead a rapidly growing private practice

TLDR
- In ortho group with high overhead, not feeling fairly compensated, and curious on what to do next

It's time for you to open your own shop.

 

[Dr. Ice]

PP orthos will never love you back

 

[BobBarker]

Correct. You can’t take call for them so at best you are a sidekick.

 

[Agast]

Correct. You can’t take call for them so at best you are a sidekick.

I take practice call. The days they are on call for the hospital are the days the surgeons are on call. On the other days it’s basically a phone line and routing questions.

 

[Dr. Ice]

I take practice call. The days they are on call for the hospital are the days the surgeons are on call. On the other days it’s basically a phone line and routing questions.

Same. I used to have to field surgical calls with questions about drains and the like. That was eliminated this year. No it’s just call for the pain service

 

[mille125]

I take practice call. The days they are on call for the hospital are the days the surgeons are on call. On the other days it’s basically a phone line and routing questions.

Does it take an MD to man that?

 

[Agast]

Does it take an MD to man that?

It’s probably a liability thing. And an insurance requirement. The call service sends me a message, and I either call the patient or forward it to my partners depending on how complicated the question is.

 

[BlockJock]

I would negotiate if they could add tier(s) to your current formula. 40% >650, then 50% > 1 M, etc. This is a strong argument because your overhead plateus and it shouldn't remain a fixed 60%. It's a win-win because you are incentivized to work harder. You have to be willing to leave to have leverage.

I do think you need to change your perspective though. A lot of what you are getting at is fairness. The partners' collections, compensation don't matter. You didn't take the risk to get there. You didn't sign up with that expectation either, so they aren't screwing you out of partnership. Even with your current formula, you could've done the math from day 1 and known what the split would be at 1.2M, 1.7M so you need to check your perspective that somehow now things are unfair and you are entitled to more despite agreeing to those terms.

The tiered formula seems to make the most sense

I don't know if what I'm getting at is "fairness" versus "market value". My group was very clear that they would not offer partnership to pain physicians, which I was and still am fine with. The frustrating part is that the prior pain doctor was reportedly on a 48-50% flat structure, and I had naively assumed that I would be able to get something similar while adding in an advanced portfolio and exhibiting new revenue lines.

But I do appreciate the recommendation of changing perspectives. I certainly think part of the tone and my thinking is influence by some level of bitterness, albeit mild to moderate

 

[BlockJock]

Ortho groups have notoriously high overhead. I’m in one, as an equal partner, and that’s probably about what ours is.

Sounds like with your goals your best bet is you need to analyze your pay pattern and figure out how to game the system. That requires no negotiation or risk on your part. If you negotiate for one thing, make it for a piece of the mid level’s productivity since you’ll be doing the supervising. Even if not though, with in-office procedures you make far more per unit time doing injections than follow ups.

In private practice (ie non-wRVU model) very few things in medicine reimburse as much as a busy spinal injection day.

Advanced procedures are good marketing but not great per unit time, except for in office SCS trial and kypho. Drop pumps entirely unless there’s a really compelling reason for you to donate your time like that. For SCS if you have a neurosurg partner who likes to do implants, you could even refer to them unless there’s a compelling reason for perc leads. They’ll be happy with the implants and you’ll make $1000 or so per trial in office after expenses.

Alternatively, if you have an ASC that will give you shares based on just your advanced procedure volume without requiring you to bring 30% of your RFs there too, but in there for as much as they’ll let you. Do your stim implants there. Intracept also pays well for ASCs. You could also ask for an overhead break on ASC based income since they’re arguing you should pay more due to office utilization.

No NSGY in my group and my spine guys have no desire to do paddles. I've been doing pumps to help develop some ASC volume, although this certainly may be short sighted on my end. My ASC has no requirements on me doing any injections there, which has been nice.

I will say I have had some issues with getting them to play ball with BVNA. The last time I had approached them, they had told me they would get a facility fee of 10K with Boston charging them around 7K for the kit, so they really only wanted to limit me to just Medicare. Which has led me to refer all of these cases out

 

[BlockJock]

It's time for you to open your own shop.

It's certainly something that I've given thought to. On my end, I think there's certainly knowledge gap on how to best set up a practice (will have to deep dive through the forum) and some feeling of financial insecurity

1) I had talked to a private practice guy in my area, who previously had worked in my group. He had told me that the insurance payments were significantly better for the same office based procedure performed at the ortho group compared to his own practice. I would be curious on how to maximize contacts and payments from commercial payers in a saturated area

2) The current spine surgeon market on my end is dominated by Ortho groups, most of which have an affiliated pain doctor. Almost no strong NSGY spine presence for whatever reason. The other spine surgeons in my area are pretty much all hospital employed, who also has pain docs (granted, these docs in my area are not that productive and don't seem to have much desire to be more productive). Long way of saying there are very few mom and pop style pain practices in my area

 

[callmeanesthesia]

No NSGY in my group and my spine guys have no desire to do paddles. I've been doing pumps to help develop some ASC volume, although this certainly may be short sighted on my end. My ASC has no requirements on me doing any injections there, which has been nice.

I will say I have had some issues with getting them to play ball with BVNA. The last time I had approached them, they had told me they would get a facility fee of 10K with Boston charging them around 7K for the kit, so they really only wanted to limit me to just Medicare. Which has led me to refer all of these cases out

Boston can move a bit on the kit price especially if it’s an independent ASC. Once you get comfortable with them the case including turnover can be done in 45 minutes. Intracept doesn’t make a ton of sense from the pro fee side since you’d make way more in the same time doing a few epidurals and an RF in office.