Orthopedics and Spine: How 3 Threats Can Become Opportunities


“The sky is not falling,” said Bill Munley, vice president of Orthopedics and Professional Services, at a session during Becker’s Hospital Review 4th Annual Meeting in Chicago on May 9.

Throughout a session,  panelists including Mr. Munley, Jeff Leland, CEO of Blue Chip Surgical Center Partners and Allen Marsh, ortho/neuroscience/surgery service line director at CaroMont Health in Gastonia, N.C., reiterated that many of the perceived threats facing the industry can be seen as opportunities.


How bundled payment programs are opportunities. “Bundled payment programs represent opportunities for surgeons and hospitals that recognize fee for service is gone,” said Mr. Leland. As operating rooms increasingly become cost centers for hospitals, hospitals have a chance to use value-based purchasing and subcontracting to keep quality of care high while keeping costs down, said Mr. Munley.


How patients paying out-of-pocket are an opportunity. All panelists agreed that patient volume in the orthopedic and spine industry will increase in the coming years. Mr. Marsh noted that more orthopedic and spine patients is a “huge expense for insurers,” and many procedures are not covered.


This will lead to an increase of patients paying out-of-pocket for procedures. “Are you prepared to take cash payments?” asked Mr. Leland. He said most hospitals are currently unable to compute estimates for spine and orthopedic procedures or put together packages for patients paying for procedures themselves.


“This represents a definite opportunity” for hospitals to cater to patients who want to finance their own procedures, he said.


How physicians’ relationships with vendors is an opportunity. All the panelists remarked that strong ties between physicians and vendors can be challenging, but can also be a chance to reduce costs with vendors when physicians are engaged with the hospital’s cost-cutting efforts.


“When we meet with a vendor, we sit down with the physicians beforehand and have them sign a letter, saying this is the price the hospital is looking for; we as a physician group back it,” said Mr. Marsh. He said this practice has been successful in negotiating for better prices with vendors.


Negotiation with vendors can decrease prices and improve a hospital’s margin, but “You need physician support,” said Mr. Marsh.

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