Slay the CMGs: let’s write the playbook

[pitdocsvcmgs]

12 years experience, both academic and community. I was part of an SDG gobbled up by a CMG at about 3x earnings. I did not receive much of a windfall (about 6 months salary). On the other hand, our group director and his immediate group of sycophants continued regional roles, begging us to drink the KoolAid until their full complement of shares vest. These people will never need to work again regardless of what goes down as they had multiple cash-out ladder steps along the way even without being fully vested.

My CMG is nearing Chapter 11.

Opportunity knocks.

My immediate partners, as soon as Chapter 11 is filed by the CMG, will consider ourselves free agents. We will be unencumbered by a non-compete (and will be prepared to fight at any other suggestion). Since our site is profitable, the site WILL BE TARGETED by other CMGs. Recognizing that our hospital administration will want a rapid succession plan with as little disruption to hospital services and medical staff drama as possible, we plan to present them with a contract proposal re-installing us as an SDG. We know that USACS or other CMG analogue will also be knocking on the C-suite door (indeed, I'm sure they've already started the poaching process).

Here is where I need the SDN Hive Mind:

If you were going to strategize (starting with a written approach hospital admin outlining our desire to revert back to an SDG and keep the contract) what would you do? I’ll take these ideas and discuss with my partners and likely incorporate a few into our approach. I AM GOING TO POST OUR INITIAL LETTER to admin and detail the process ON THIS FORUM AS WELL AS REDDIT. I want to start a movement where every SDG in the country that might find itself with a pending bankrupt CMG as overlords has a playbook.

Further along, I can imaging that this may be the initial steps of creating a vehicle to raise funds for a national organization that can help fledgling SDGs (without taking an equity stake themselves and creating the next round of CMGs backed by PE) get out from under a struggling or inattentive CMG and have financial support to get them through the first few months while collections roll in. Not a union, but a loose-net collection of doctors taking the fight back.

Game On. Start posting. If you're not comfortable doing it here, create a new account, or email me at:
[email protected].

I will gather and summarize posts from time to time and when I start the Reddit thread, I'll cross-post and seek to have a common way to summarize that arm too.

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[FlaminHotER]

God speed fellow pit doc!

 

[Cinclus]

My fellow docs are currently fleeing our CMG site due to the CMG's rapidly strengthening deathgrip on sanity (their plans for changes are entirely sane only from a money standpoint). This is another place where the SDG was taken over several years back. From speaking with some of my coworkers, many of us would love to come back as a SDG. This particular CMG is also about to file chapter 11...and I'm about to GTFO, too, much like the other ED docs.

 

[EctopicFetus]

Those working for envision should reach out to your local hospital leadership and let them know your intent. Things will get better etc. I think the playbook isnt that complicated. Get a good billing/coding company to help you run the biz, consider reaching out to AAEM for detailed help thru their AAEM PG which will give specific assistance to a group. Dump ACEP and the crony capitalism it is based on. These are the steps. The biz side of EM isnt complicated. There is money to be made. Envision is the first domino but more are on the way to collapse. I suspect USACS has some room to run but their death wont be far behind. TH has epic levels of debt as well. SImilarly APP just refinanced their debt but the details are not known i dont think. Schumacher leads all IDR filings which means they are getting decimated with their OON claims. Most people have stated that the new QPA is Medicare rates.

 

[RustedFox]

My site was told that we have been spun off and now work directly for HCA under the moniker of Valesco.

 

[FlaminHotER]

I suspect with another Fed Rate hike coming in May this will likely be the straw the breaks many camels backs

Envision falls first

Then likely usucks not long after

 

[TrailRun]

Isn’t this bad news for EM in general? Of course CMGs going down seems good, but doesn’t that mean EM is becoming less profitable/sustainable overall? Like if a CMG that pays docs low and understaffs can’t be profitable, then how would a SDG that pays docs well and staffs adequately work? Or is it just that there would be less overhead (admin salaries)?

 

[Birdstrike]

Or is it just that there would be less overhead (admin salaries)?

Bingo

 

[TooMuchResearch]

Isn’t this bad news for EM in general? Of course CMGs going down seems good, but doesn’t that mean EM is becoming less profitable/sustainable overall? Like if a CMG that pays docs low and understaffs can’t be profitable, then how would a SDG that pays docs well and staffs adequately work? Or is it just that there would be less overhead (admin salaries)?

Democratic group checking in:
We make enough money per patient to get paid well, pay our office staff, throw a modest annual party, spend money on several "committees" that seem to provide limited value (at best), and still have money to burn on more physician admin bloat than I think is needed. I'd try for an admin gig, but likely wouldn't be very popular with a stated goal of reducing admin bloat and then terminating my admin role once goal is accomplished.
We don't need to send a cut of our money to CMG overlords or their PE overlords. That's the difference.

 

[BoardingDoc]

Democratic group checking in:
We make enough money per patient to get paid well, pay our office staff, throw a modest annual party, spend money on several "committees" that seem to provide limited value (at best), and still have money to burn on more physician admin bloat than I think is needed. I'd try for an admin gig, but likely wouldn't be very popular with a stated goal of reducing admin bloat and then terminating my admin role once goal is accomplished.
We don't need to send a cut of our money to CMG overlords or their PE overlords. That's the difference.

Indeed. Our group is doing just fine in an area with a not terrible but certainly not rich payor mix and is able to keep us all making a lot more per hr than any of my friends who work for area CMGs (and no, we don't make money off of new hires either. You keep what you kill from day 1.) Knowing what our admin gets paid, the admin costs of these CMGs must be astronomical. Cut out the fat cats and it turns out there's plenty of money to go around.

 

[Pigg-O-Stat]

This is my favorite thread topic ever.

For the life of me, I can't figure out what CMGs do for us that we can't do for ourselves.

 

[TooMuchResearch]

Indeed. Our group is doing just fine in an area with a not terrible but certainly not rich payor mix and is able to keep us all making a lot more per hr than any of my friends who work for area CMGs (and no, we don't make money off of new hires either. You keep what you kill from day 1.) Knowing what our admin gets paid, the admin costs of these CMGs must be astronomical. Cut out the fat cats and it turns out there's plenty of money to go around.

We make some but honestly not that much from our new hires. Once you do the math on benefits, 401k profit sharing, CME allowance, etc it's very little we make from them. But it's the system we use, and we're not really into fixing systems that still work. People rail on this forum about not taking the risk with SDGs with a partner track, but we have no shortage of new grads and experienced docs that want to work with us.

Yes, I'm worried about our future, but everything is running okay right now.

 

[TooMuchResearch]

This is my favorite thread topic ever.

For the life of me, I can't figure out what CMGs do for us that we can't do for ourselves.

Nothing. They just make you think the business side is too complicated, but it really isn't. Even if you think it is, you can hire help or get help from AAEM.

 

[FlaminHotER]

Isn’t this bad news for EM in general? Of course CMGs going down seems good, but doesn’t that mean EM is becoming less profitable/sustainable overall? Like if a CMG that pays docs low and understaffs can’t be profitable, then how would a SDG that pays docs well and staffs adequately work? Or is it just that there would be less overhead (admin salaries)?

Wayyy less BS middlemen taking their cut of the pie



Also

 

[Boatswain2PA]

This is my favorite thread topic ever.

For the life of me, I can't figure out what CMGs do for us that we can't do for ourselves.

I asked corporate shill (who I think is a really a good guy, but has fallen for corporate glory) that exact question ("What exactly DOES usacs do for this team here?) during their "visit" meeting. He answered better billing, training, safety, blah blah blah....

 

[FlaminHotER]

I asked corporate shill (who I think is a really a good guy, but has fallen for corporate glory) that exact question ("What exactly DOES usacs do for this team here?) during their "visit" meeting. He answered better billing, training, safety, blah blah blah....

Anytime I hear “training” as a justification, I’m like

“you mean freakin medical school and residency!?”

These CMGs deserve to implode

Every freakin last one of them

 

[pitdocsvcmgs]

Isn’t this bad news for EM in general? Of course CMGs going down seems good, but doesn’t that mean EM is becoming less profitable/sustainable overall? Like if a CMG that pays docs low and understaffs can’t be profitable, then how would a SDG that pays docs well and staffs adequately work? Or is it just that there would be less overhead (admin salaries)?

It's bad if a re-organized CMG secures all the profitable sites and no group of docs are able to secure their own SDG at profitable sites.

This is what the CMGs were strategizing: Just buy ALL the contracts, and over time abandon the low performers/loss leaders to hospitals and SDGs with rose colored glasses. Their end game was always to own all the profitable contracts. The rise in rates, however, has caught them flat footed. The idea is to hope that these CMGs fail as quickly as possible, and docs can be savvy and nimble enough to re-establish SDGs at profitable sites before a re-organized CMG with the same greedy as$hats at the top under a new banner take back over. This hopefully resets the market and allows doctors to once again get paid what they're worth and what they earn if they can cut out the CMG rape of emergency medicine.

 

[RustedFox]

All of this doesn't solve one problem: how did the SDGs lose out to CMGs in the first place?

The admins were the ones who (thru their never-ending tantrums) gave the contracts to the CMGs in the first place.

 

[WorkNoteEmergency]

First thing in laying groundwork is reassure the hospital admins is to make them comfortable that they won’t have to do anything and everything will be just as before “the change”. I would reach out to coding and billing companies, maybe even a practice management company to have that dialed in. Message me if you need a guy for practice management, I’m hospital employed but might have very experienced contact from years ago. You need to know who in the group is all in so you get a sense of what kind of holes might need to be filled. The guys/gals who are in need to be ready to have low or no paychecks for some time while billing and reimbursement catch up. This might be the most important to keep cohesion through a rough stretch.

I would look at the USACS takeover of Summa Health in Ohio for building a defense against the CMG’s. They had a bit of inside track from the admin but they mobilized docs from all over on very short notice to take that group over so you want to make sure you have your **** together and everything is airtight.

 

[gutonc]

All of this doesn't solve one problem: how did the SDGs lose out to CMGs in the first place?

The admins were the ones who (thru their never-ending tantrums) gave the contracts to the CMGs in the first place.

The smart ones (and I assure you, there are a few of them out there), will recognize that the CMG promises were lies and hopefully have the institutional memory to remember that things were actually pretty good in the "before times".

It won't be simple, and it won't be universal. But I am betting it will happen in a few places, and hopefully the butterfly effect will take hold and eventually the ripple will become a tsunami. But first, medicine (not just EM, but you all are definitely the tip of the spear) will need to survive the coming winter.

 

[Janders]

Talk to AAEM, they can hand hold you through it.

The coding/billing is easy, you can contract that out to a big national group who will do a good job for a (reasonable) overhead fee.

Frankly things like payroll, retirement accounts, basic insurance and banking can be done reasonably easily for a smaller group.

Contract with insurance companies, thats a bit more complicated.

Pay yourselves first, keep a lean initial admin model, completely open books, etc.

 

[southerndoc]

Talk to AAEM, they can hand hold you through it.

The coding/billing is easy, you can contract that out to a big national group who will do a good job for a (reasonable) overhead fee.

Frankly things like payroll, retirement accounts, basic insurance and banking can be done reasonably easily for a smaller group.

Contract with insurance companies, thats a bit more complicated.

Pay yourselves first, keep a lean initial admin model, completely open books, etc.

Honestly, I would look into using AI to code your charts. Would eliminate even more overhead.

 

[Mbekweni]

My two main concerns with starting a group are insurance contracts and how to ride out the first year until billing comes in. When our group started at a new site it took 6-9 months until Medicare and Medicaid funds came in. That’s a lot of working for cheap until you get established. Second hospital we merged with SDG and word on the street is our contracts were better and collections per patient with same docs and same location went up by 15%.

 

[Birdstrike]

All of this doesn't solve one problem: how did the SDGs lose out to CMGs in the first place?

The admins were the ones who (thru their never-ending tantrums) gave the contracts to the CMGs in the first place.

CMGs sold the hospitals on “cheaper labor for same or better quality.” In most cases, they weren’t able to deliver. But most of the SDG were killed off, in the process.

 

[JacobMcCandles]

The CMGs have incredible presenters and salesmen because that’s what they do. They woo administrators and really get them eating out of their hand. We’re physicians and, for the most part, don’t have those kinds of people in our groups. There’s now enough data that these CMGs don’t deliver what they promise and they don’t end up being cheaper. The only thing they provide is they turn those already burned out and overworked and make it worse for them.

 

[GonnaBeADoc2222]

My two main concerns with starting a group are insurance contracts and how to ride out the first year until billing comes in. When our group started at a new site it took 6-9 months until Medicare and Medicaid funds came in. That’s a lot of working for cheap until you get established. Second hospital we merged with SDG and word on the street is our contracts were better and collections per patient with same docs and same location went up by 15%.

The attendings I work with could never stomach this initial period, even if it means greener pastures in the future. Too busy paying for private NYC colleges, luxury EV cars and expanding their houses to 7,000 sq ft

 

[DeadCactus]

Isn’t this bad news for EM in general? Of course CMGs going down seems good, but doesn’t that mean EM is becoming less profitable/sustainable overall? Like if a CMG that pays docs low and understaffs can’t be profitable, then how would a SDG that pays docs well and staffs adequately work? Or is it just that there would be less overhead (admin salaries)?

Investment in 20th century was about using investor money to build a profitable, expandable, and durable business in exchange for dividends and steady growth. Investment in the 21st century is about using a business to inflate the value of ownership so that founders and early investors can bail out with large sums of money before everything collapses. The financial investment model has shifted from hopping on an escalator to trying to hop on a ferris wheel at the right time. The failure of large corporations has little to do with the viability of the underlying industry.

 

[Birdstrike]

The attendings I work with could never stomach this initial period, even if it means greener pastures in the future. Too busy paying for private NYC colleges, luxury EV cars and expanding their houses to 7,000 sq ft

This exact thing is what allowed CMGs to so easily kill SDGs in the first place. Anytime a CMG came in and took over a contract, what did the docs do?

1) Did they stand strong from a position of strength, honor their non-competes and refuse to sign with the CMG at their site? Or did they,

2) Immediately panic, fold, and sign with CMGs that just undercut their SDGs?

In almost every case, docs would choose #2, when #1 would have been the choice that would have made CMG takeovers disastrous for both hospitals and CMGs.

Did ACEP or any other EM entity offer guidance on this, or have any policy with teeth in it that would encourage standing strong against CMGs, or punishing the opposite?

No. The entire speciality folded without the slightest of a fight.

 

[Mount Asclepius]

This exact thing is what allowed CMGs to so easily kill SDGs in the first place. Anytime a CMG came in and took over a contract, what did the docs do?

1) Did they stand strong from a position of strength, honor their non-competes and refuse to sign with the CMG at their site? Or did they,

2) Immediately panic, fold, and sign with CMGs that just undercut their SDGs?

In almost every case, docs would choose #2, when #1 would have been the choice that would have made CMG takeovers disastrous for both hospitals and CMGs.

Did ACEP or any other EM entity offer guidance on this, or have any policy with teeth in it that would encourage standing strong against CMGs, or punishing the opposite?

No. The entire speciality folded without the slightest of a fight.

Our SDG chose #1 over #2 and weathered the storm. You have to think like a business owner just as much as a physician to win this fight. We are equipped with the intelligence, drive and skills to win this fight. It takes effort and work though. You won’t regret seemingly uncompensated time spent.

 

[JacobMcCandles]

You can always ask your hospital for a 0% line of credit for bills, small salary draw, etc. until you start collecting on receivables. This is a real thing and does happen.

 

[Mount Asclepius]

You can also receive compensation based upon a percent of your billing instead of collections. Your group still handles the E/M coding, but the hospital handles collections which they do anyways. Their coders just aren’t always familiar or as astute with EM coding. Allows for more immediate compensation without a prolonged lag time in income waiting for the collections when the hospital has deeper reserves.

 

[TooMuchResearch]

Or just get a line of credit for the business.

 

[Backpack234]

Dear any other ER docs trying to overthrow their CMG. Please read your contracts. Non competes. Non interference clauses. Can’t say bad things about the corporation publicly. Etc. all of these things may or may not exist in your contract and may or may not be enforced. Just something to be aware of as you plot your takeovers.

 

[dieABRdie]

12 years experience, both academic and community. I was part of an SDG gobbled up by a CMG at about 3x earnings. I did not receive much of a windfall (about 6 months salary). On the other hand, our group director and his immediate group of sycophants continued regional roles, begging us to drink the KoolAid until their full complement of shares vest. These people will never need to work again regardless of what goes down as they had multiple cash-out ladder steps along the way even without being fully vested.

My CMG is nearing Chapter 11.

Opportunity knocks.

My immediate partners, as soon as Chapter 11 is filed by the CMG, will consider ourselves free agents. We will be unencumbered by a non-compete (and will be prepared to fight at any other suggestion). Since our site is profitable, the site WILL BE TARGETED by other CMGs. Recognizing that our hospital administration will want a rapid succession plan with as little disruption to hospital services and medical staff drama as possible, we plan to present them with a contract proposal re-installing us as an SDG. We know that USACS or other CMG analogue will also be knocking on the C-suite door (indeed, I'm sure they've already started the poaching process).

Here is where I need the SDN Hive Mind:

If you were going to strategize (starting with a written approach hospital admin outlining our desire to revert back to an SDG and keep the contract) what would you do? I’ll take these ideas and discuss with my partners and likely incorporate a few into our approach. I AM GOING TO POST OUR INITIAL LETTER to admin and detail the process ON THIS FORUM AS WELL AS REDDIT. I want to start a movement where every SDG in the country that might find itself with a pending bankrupt CMG as overlords has a playbook.

Further along, I can imaging that this may be the initial steps of creating a vehicle to raise funds for a national organization that can help fledgling SDGs (without taking an equity stake themselves and creating the next round of CMGs backed by PE) get out from under a struggling or inattentive CMG and have financial support to get them through the first few months while collections roll in. Not a union, but a loose-net collection of doctors taking the fight back.

Game On. Start posting. If you're not comfortable doing it here, create a new account, or email me at:
[email protected].

I will gather and summarize posts from time to time and when I start the Reddit thread, I'll cross-post and seek to have a common way to summarize that arm too.

I love it. Definitely felt the collapse of PE in medicine would be a fantastic opportunity for private docs to move in where they fail. I'm not ER... but will be following.

But... is there a PRIVATE forum you can use to post these things? (we have one for rad onc "Business") Best not to let your enemy see your battle plans.

 

[southerndoc]

Dear any other ER docs trying to overthrow their CMG. Please read your contracts. Non competes. Non interference clauses. Can’t say bad things about the corporation publicly. Etc. all of these things may or may not exist in your contract and may or may not be enforced. Just something to be aware of as you plot your takeovers.

Non-competes don't usually apply when a company goes bankrupt. Hopefully FTC bans them all together.

 

[TysonCook]

You can get a line of credit from most banks or credit unions to fund your AR. Sometimes the hospital is giving a stipend to the CMG, see if that applies and you can also use that. AAEM has a lot of resources.

 

[bravotwozero]

I can’t say I can offer you any useful advice, but wish you guys the best of luck. I hope y’all get to form a great SDG that thrives. I think I speak for everyone when I say we’re all rooting for you. A W for the underdog can give us a modicum of hope.

 

[TooMuchResearch]

You can get a line of credit from most banks or credit unions to fund your AR. Sometimes the hospital is giving a stipend to the CMG, see if that applies and you can also use that. AAEM has a lot of resources.

I think if you find any smaller or doctor type lender that gets the business they'd offer a good line of credit or loan.

I'll put in a plug for Panacea here. They do physician personal and practice loans. You'd have to check if they'd be willing or able to finance 3-6 months of payroll for a group.

 

[TysonCook]

You also don't necessarily need a ton of $ for AR. A lot of our billing goes out and payment back within 1-2 weeks. There is some that doesn't and tails off (eventually to collections) but overall fairly quick turn-around.

If you haven't looked at RCM companies then you should start.

AAEM has a lot of resources on this, I hope you have gotten them involved.