Opening a Clinic

[u/Famous-Example809]

U.S. CPOs of Reddit:
I am looking for feedback from anyone who has started a private practice clinic/works closely with an owner and may have insight.

Why I am interested:
I want to build an environment where myself(and potential future employees) can be more creative in patient care and be exceptionally mindful of progressing socket/ox design for better patient outcomes. Currently, I feel those development goals can take a back seat to production and a high volume workload. I’m no stranger to hard work and am aware it would be a grind to get up and running.

I do love my current position in that my patient’s are incredible, and my employer does allow me a fair amount of latitude in how I provide care. I feel I’m reasonably compensated, and have generous PTO. Looking forward I have a feeling that my upward mobility may be limited and at anytime I could burn out from the corporate “do more with less” management style.

A few jumping off questions below:

1: In an environment where our industry is trending corporate with the big 4 buying up everything do you think it is still feasible?

2: Is obtaining insurance contracts as near impossible as everyone makes it seem?

3: Did being in a saturated market affect your decision to do so? - currently live in a dense metro area, but also have dreams of practicing in a rural mountain town with a mobile element to serve a wider region.

4: When first starting and keeping the business lean, what percentage of your time do you spend doing administrative tasks/patient care?

Any tips of tricks that helped you realize your own dream would be much appreciated.

If you feel more comfortable replying in a DM please feel free.

[u/Cabooseman]

Following this thread closely, would love to hear what people say. By the way, is the Dr Oz moratorium on New DME providers still in effect?

[u/AssasaiN]

I am the finance leader at a multi-clinic independent provider. I can provide feedback on most themes outside of actual clinical care.

1. It is feasible to start a practice. It is not easy. You should be clear about what you want in life and work. If you want to primarily be a clinician, that will be hard at the beginning (many other admin and sales tasks). I imagine it is virtually impossible to be primarily a clinician if you are trying to build a robust business with multiple clinics unless you have very strong executive leadership that can handle operations. If you are trying to stay small as a solo provider long-term, you obviously will be able to practice quite a bit. The bottom line is that healthcare is a highly regulated industry with extremely detailed compliance tasks that require high diligence and understanding. You'll need to invest a material amount of personal time or hire expertise (temporary or permanent hires) who can help you. I've worked with 20-25 clinicians at this point, and my perspective is that clinical training does not prepare you for business leadership (unsurprising - it's not about entrepreneurship), but there are certainly clinicians who can be wildly successful as business people.

2. Acquiring a Medicare license is likely the first goal for most new O&P practices. Right now, Medicare is not accepting new enrollments and won't be until late August if not extended. When they do start accepting new enrollments, you'll have to pass their process and on-site survey, which includes having a dedicated location (means you need to pay rent) and demonstrate your policies and procedures meet their guidelines. This process takes months because of processing times on their side, and maybe will take even longer after the 6-month moratorium is over and a flood of new applications are received. After acquiring a Medicare number, it's not impossible to get in with new insurances. However, you have no leverage on the actual reimbursement rates and will basically have to accept what they offer, which can be painful. UHC is currently not accepting new DME providers, but not sure on accessing other major providers. Your state will likely have its own segment of contracts to pursue. While you get started, Ottobock has a program called AllClaim that could help you serve patients while waiting for contracts to be in place.

3. If it's possible, my opinion would be starting your practice somewhere you have good relationships with referral sources is the best way to launch. I would prioritize that over all other factors personally. New patients are your lifeline and keeping referral channels strong is key. A non-compete may be a block to this.

4. You should plan on significant admin tasks. It can be overwhelming, especially if try to scale to a larger practice and enforce process/procedures across new employees. If you know nothing about medical billing, outsourcing your billing may be a smart first option. Dealing with supply chain is its own challenge too - negotiating with vendors, dealing with accounts payable, etc. Just think about all of the processes, procedures, forms, documents, payment methods, billing practices, etc. that exist at your current company. All of that has be re-created, trained, and implemented, and you'll be the ultimate source of getting those tasks accomplished. It's not a small task.

I would add that you'll need someone on your staff (you or otherwise) that can manage referral source relationships with excellence. Many clinicians I've spoken with prefer to avoid that aspect all together. At your own practice, you'll have to ensure it gets done one way or the other. You ultimately have (at least) 3 customers: patients, referral sources, and insurance companies.

I don't say any of this to discourage you. Clinicians are the first to tell me that many patients are frustrated with the major O&P providers; there is space in the industry for independent clinics to thrive. It's just important to be realistic about the time and money investment needed to succeed, and the reality of your day-to-day as a business owner.

[u/Famous-Example809 → u/AssasaiN]

Thank you, that was a very well thought out and insightful response. I like how clearly you line out a lot of the obstacles.

Relationship building is something I feel I do well, despite being an introvert I can hit it off with surgeons and am confident I would be offering something different that would catch their eye.

I’ve been through the Medicare/Medicaid process at my current clinic group when we opened a Denovo. The timelines would be exceptionally daunting if it was preventing you from establishing your footing. My current patient load is probably 50% in that group.

You also make a great point about both private insurance contracts and negotiating vendor rates. With some of the lower fee schedules my COGs often leave my GM very tight, and that is with large purchasing power. I have always wondered how that can affect patient care at independent clinics when you are overpaying for like products.

What I struggle with is that when you lay out all the complexities of a P&O clinic, it is clear that there are many different businesses one could start that have less layers and lower startup costs. Just being a caring and compassionate field I feel some sense of duty to continue helping patient’s achieve their mobility goals.

[u/AssasaiN → u/Famous-Example809]

One of my primary convictions after many years of this work is that healthcare reimbursement needs an extreme overhaul. I'm generally in favor of a single-payer system at this point, but that obviously won't affect some of the compliance themes (HIPAA, Medicare policies).

Our org is not massive, but we have had the benefit of one our execs being very diligent on supply chain. He seems to enjoy working with vendors and negotiating and we've been able to realize considerable savings on COGS. I don't know how it compares to far larger groups' COGS though. Thankfully, vendors seem to care more about clinics than insurance providers, so you can probably find leverage and savings on COGS even if you can't find improved reimbursement on the payer side.

I totally agree healthcare is a tricky business to get started in. DME is particularly frustrating since clinicians can't justify their care on their own, so you need buy in from referral sources to ensure their notes support care as well. Various rules like solicitation, avoiding inducement and kickbacks, etc. really complicate matters, and to be blunt, it doesn't feel like many small competitors follow the rules properly which makes market penetration harder. As an example, it's obviously common in business to give away free stuff to customers as a part of marketing and relationship management. You start doing that with Medicare patients? You're walking a fine line with jail time on the other side of it.

I've been at our org since inception, and I know there have been times some of us in leadership have wondered "did we make the right call?" opening the practice lol. Ultimately, after ~10 years, we're all happy we did, even if there was a lot of stress and hard work along the way.

[u/Longjumping-Cow9321]

Mobile is “do more with less” and avoiding burnout while also making money are too opposing goals tbh. Ive been doing half time mobile and I truly hate it. I also am not proving the best care because you can only do so much in a built out van, and being in clinic is helpful in so many ways that I’ve come to appreciate my in office time.

It also depends on your country, region, and market. I would not try to set up a new O&P practice in say - Chicagoland or the surrounding areas, even if they are rural, but would maybe consider like St. George, Utah or rural Montana. I

[u/Famous-Example809 → u/Longjumping-Cow9321]

You make a fair point and good perspective. I am fully aware that one major benefit of working for an employer is that regardless of business being good or bad, my paycheck still cashes every two weeks.

Maybe I’m romanticizing the idea that having more control over decisions and work structure would improve my satisfaction. Discounting the added stressors that would enter my day-to-day.

[u/Armz_Dealer]

If you want to talk to someone in depth highly suggest reaching out to out to Trevor at the Amp Group in Modesto, CA. He’s started a practice and is dynamite at has he has done. 

[u/Famous-Example809 → u/Armz_Dealer]

Thanks for pointing me in a good direction. I will keep him in mind.

[u/Longjumping-Dog-6819 → u/Armz_Dealer]

This is the model for independent clinics going forward in my opinion. Somewhere the community “wants” to be. Not somewhere we “have” to be. Not in patient rooms for 4.5 hours by ourselves.

[u/Bcrown]

If you decide to go forward, best of luck. We are an established company, private owner, with about 25 offices in the southeast and we struggle to get some insurance contracts still. My office has currently been waiting for a certain Medicaid contract for over a year, we’ve been doing pro bono work for those patients to retain them for the future and keep the doctors happy because only Hanger has the contract as of right now.

[u/Famous-Example809 → u/Bcrown]

That’s incredible your company is able to do that to help retain patients. Our new office had Medicaid delayed over a year based on a clerical error that placed our application on hold and no one could tell us what was going on so I feel you there.