Ideals for Survival

[jmj11]

My practice (headache clinic) has been in business for a year an a half. Because I had build a reputation for the previous eight years, the demand for our services was through the roof after opening our doors up until three months ago. There has been a drastic change in events that could be our demise unless I create a plan.

 

In our region of NW Washington state, two large hospitals have been gobbling up practices like Pac Man and dots. Now, 80% of all local primary care and specialty practices are owned by one of these two hospital systems. The closes hospital to us, I will call System A.

 

System A had one neurologist (whom I know well) who has no expertise in headache. When they hired her, I saw a dip in my referrals. But then they just hired a new neurologist (residency) graduate and they require all referrals to be sent to him. In a matter of days of his hire, our referral base has completely vanished. Now, the only referrals we are getting are low-payers (Medicaid and Medicare). We cannot survive like this.

 

Now, me being bought out by System A is not an option. I have dealt with them for a decade and use to have privileges with them. I find that their administration has a very low view of PAs and what they offer.

 

Now system B is much further away and is actually more friendly towards me and I actually worked for them as a contract employee and I've started a dialog with them. We will see what happens. I do carry a business debt from our opening and it would be hard to just walk away from it.

 

So, any creative ideas how to fight against such odds? We deliver better care and there is no doubt about that. However, when you have a huge hospital system that promotes a neurologist, untrained in headache, as being the much better product, then the cards are stacked against you.

[Timon]

If I were in your shoes I'd start by identifying the problem and would conduct a marketing audit with SWOT analysis. From there I'd create a unique selling proposition for your practice and would target everyone of my previous patients and promote using your services again. I suggest local grassroots advertising and also targeting patients that you may have not marketed towards previously. I'd also probably probe further into System A and find out what they are doing then come back and strategize on either developing a more beneficial partnership or on what you need to do in order to compete with them. Just few things to toss out there that you can do to set you apart are walk in visits, expertise, wait times, capacity, location, etc. small enough to know your name but large enough to serve you type message compared to System A.

 

I hope this helps in any way, just going back from my previous business experience. You know the industry maybe you need to partner with someone local that can help with marketing and maintaining / acquiring new business / patients.

[Guest Paula]

I'd negotiate with system B to become a satellite clinic, and retain some of your ownership rights if possible. Health care in America is being gobbled up by the big organizations. We are seeing it here in the mid-west, and our local hospital and clinic (that belonged to a fairly large organization), has just merged with an even bigger organization from another state. It's the second time in 10 years that has happened. We have only one independent practice in town (an orthopedist), and he has loose association now with a competing organization of our hospital. It is difficult even for private MDs to stay self-employed.

 

Good luck in your decision.

[jmj11]

Thanks for your thoughts. I've started a new discussion with System B today (but the CFO is leaving for three weeks tomorrow) and we will see where that goes. I dream of keeping my clinic though.

 

I have done SWOT type analysis as part of the business plan and on a routine basis. We know what the problem is, 80%+ of our referrals are now blocked. We have spent $20,000 in the last 14 months on marketing and I'm not sure that is part of the problem. We do need to try and reach huge undeserved market in the Seattle metro area, but haven't figured out how to do that yet.

[Gaven32]

It's the second time in 2 decades that has occurred. We have only one separate exercise in city (an orthopedist) and he has reduce company now with a competitive company of our medical center. It is challenging even for personal MDs to remain self-employed.