How the economy affects spine surgeons — And what they need to know for the future


How does the gross domestic product growth affect physician practices? Does it matter that the economy is in a recession? What does the national debt have to do with physician practices?

Economic trends can reflect current trends in healthcare spending and predict where it's headed in the future. "The total gross domestic product growth for 2015 is a good indicator of consumer spending and it will likely be 2.5 percent, which is a good 1 percent below the historical growth patterns," says Charles S. Theofilos, MD, a board-certified neurosurgeon and founder of The Spine Center in Palm Beach Gardens, Fla.


But this isn't a new trend; during the recent recession Americans cut back on their healthcare spending, office visits, preventative health and elective procedures. "This directly affects spine surgeons and ultimately the consumer cutbacks increase a strain on the system, as patients who avoided testing and preventative care ended up clogging hospital emergency rooms with more serious conditions," says Dr. Theofilos.


The top three economic trends that will make an impact on surgeons' practices are:


1. Consumer spending: Patients are more conscientious about their healthcare dollars than in the past. Their premiums and deductibles are higher and they're considering care options more closely. "Consumer spending directly affects medical practices through the ability or non-ability for patients to spend on their own healthcare," says Dr. Theofilos. "If the economy is doing poorly, patients are less likely to opt for surgeries and procedures."


2. Inflation: Reimbursement doesn't always keep up with the cost of running a practice and operating on too tight of margins leaves little room for error. "Inflation affects practices from the other end by causing the costs of running a practice to increase including staff and technology costs," says Dr. Theofilos. The rising costs are his biggest concern, as the cost of employees, software and training, and general marketing costs escalate.


"In preparation, we are leveraging technology to be more efficient, responsive and play a larger role in growing the practice," says Dr. Theofilos.


3. Unemployment: Health insurance is largely still connected to employment, and when patients aren't employed their insurance options are limited. Lack of employment also hinders the patient's ability to make deductible payments in a timely fashion. "If more people are out of work, this impacts the level of patient visits, number of treatments and scheduled surgeries," says Dr. Theofilos.


So where are we headed into next year?


"It seems that the economy is on an upswing," says Dr. Theofilos. "Job creating is increasing, gas prices are down and there seems to be evidence that the economy is gaining momentum. Based on this trend, my practice should end 2015 on a good note."


These economic trends will also be important heading into 2016, a presidential election year.


"I believe to achieve financial stability going forward, spine surgeons should become more adaptable and open to change," says Dr. Theofilos. "Strategies such as working harder, leveraging, research development where appropriate, optimal utilization of technology, referral strategies, marketing and branding are all critical for the future."


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