The new USOP CEO's pitch to payers

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Stephen Holtzclaw, MD, has spent the beginning of his year getting to know the people behind U.S. Orthopaedic Partners. The emergency medicine physician was named CEO of the management services organization, and he wants to help the MSO thrive.

Dr. Holtzclaw spoke with Becker's about his goals in the role and how his background in emergency medicine will enhance his leadership within the orthopedic MSO. 

Note: This conversation was lightly edited for clarity and length.

Question: What are your top goals in this new role?

Dr. Stephen Holtzclaw: Like any new CEO, I'm looking at the priorities of visiting all the sites, meeting as many of the employees as possible and learning the culture of the organization. I think that's going to be key, along with improving communications. I don't think there's such a thing as the organization that communicates too much. They probably all need to communicate more. So I'm trying to put some plans in place around that, having regular updates with our physicians and investors. The other top priority for me is just understanding what the operational challenges are at this point in time.

Q: When you were talking to some of the employees and physicians, were there any top priorities that really stood out to you?

SH: Each one has something individual. Some are worried about the ASCs being more efficient. Others are worried about payer strategies. I think each one of them had something different, but I don't think there was an overall cultural problem. They were just sharing their individual thoughts on how to improve things.

Q: What's your vision for USOP this year? 

SH: Growth, of course. The bigger you are, the more synergies you can have. The back office efficiencies are going to be important here. The physicians are asking to make sure that we have those. With payers, their job is to pay as little as possible. We're going to be there trying to get more pay, and we're going to be doing everything we can to show them the quality that we have and how much money we save them. In Mississippi we have about 10 active bundles going on with them right now, and we've saved Blue Cross Blue Shield of Mississippi many millions of dollars, and we're looking to grow that as much as we can, not only in Mississippi, but to do that in other states.

Q: What is your plan to try and get bundles into other USOP practices and outside of Mississippi?

SH: The fact that Mississippi has done so well, we can use that as a proof statement. But also the high-quality physicians and the fact that we can do things in ASCs for a lower cost and higher quality should be an automatic interest for an insurance company. Why pay a higher cost and potentially higher complications at a hospital when you can move things to an ASC and save money and have higher quality? That's really the pitch there. I think they see and understand that we just need to get in front of them and show our worth.

Q: What got you into orthopedics and how do you think your background working in emergency medicine will inform and strengthen your role now?

SH: ER physicians are unique in medicine in that we interact with all specialties because any one of their patients could wind up in the emergency room. We deal with cardiothoracic surgery, pediatrics, radiation oncology, pulmonology — you name it, we probably interacted with them. So we have a bit of an understanding of what each specialty needs from us and what the challenges are for those people. I started out in emergency medicine doing administrative things, but it's grown from there to all these other different specialties.

Q: In the last year, a lot of smaller, independent orthopedic practices and physician practices faced economic headwinds. When it comes to issues such as payer and workforce challenges, why should an orthopedic practice consider joining an MSO like USOP?

SH: In my mind it's simple in that size matters. They could go to work at a hospital, but the hospital's view of the world is to keep as many surgeries as possible in the hospital. If you talk to any orthopedic surgeons, they say they can't be as efficient in a hospital as they can in an ASC — specifically an orthopedic ASC — because they're there to make sure that things are done efficiently and very quality. The hospital has to mix orthopedics with cardiothoracic surgery and general surgery and OB-GYN, etc. I think orthopedics is in its own world. Being outside the hospital, it's good for the patients. It saves money and it makes the orthopedic physicians more efficient.

Q: Do you think any form of consolidation will have to be inevitable for smaller practices to thrive?

SH: Well, if I've learned anything from the emergency medicine space and the others, the smaller groups do not do well when they go to negotiate with the payers for better rates and those kinds of considerations.

Q: What other healthcare trends have you been following?

SH: I think you just watch and see how frustrated physicians are with all the things that they have to put up with that don't have anything to do with taking care of patients, such as insurance forms, government regulations and EMRs. All these things are driving them crazy. None of us went to medical school because we wanted to fill out forms and go meet with insurance companies, so I think that's one of the biggest ones. Drug shortages and all the other things going on are making it a very difficult time to be a physician and focus on purely taking care of the patient.

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