This is the second article in a two-part series about spine surgeon employment. Also consider viewing the first article, answering the question "Will Spine Surgeons Be the Next Specialists Scooped Up by Hospitals?"
Five spine surgeons talk about the biggest factors influencing their decisions to become employed or practice independently.
Donald Johnson, MD, Spine Surgeon, Southeastern Spine Institute, Mt. Pleasant, S.C.: Spine surgeons who are focused on research at academic centers have always been employed, but private practice surgeons are now being enticed into employment by hospitals. If the surgeons have a facility that is dependent on a decreasing revenue stream, hospital employment becomes attractive. Every hospital has a primary care referral network, but employing specialists is a rather new situation. Now, a lot of surgeons who have gone into employment are in their third of fourth year in that situation and they are wondering what will happen next. They won't have any leverage when the next contract comes around. They've put themselves in a difficult position because it's hard for them to say they don't want to be employed anymore and return to private practice.
Surgeons who are not directly dependent on hospital-based primary care referrals are able to remain independent from hospital employment because their patients will refer them. We see more patients on referral from other patients than primary care physicians. In a lot of systems, they try to influence the referrals within the system, which is terrible. You want to be sent to the physician that takes care of the problem the best.
Finally, spine surgeons must have ancillary revenue to remain independent. Without the ancillaries, we'd be in the same position as everyone else — looking at hospital employment. Over the past 21 years, we built a practice in a business-minded fashion, and we decided there was no reason why the ancillary services shouldn't be offered here. We didn't do this thinking we'd be in this healthcare environment, but it turned out to be helpful, since we aren't dependent on a hospital.
Fred Sweet, MD, Spine Surgeon, Rockford Spine Center, Rockford, Ill.: Spine surgeons have three options: start their own practice, join an existing group of surgeons or be hired by a hospital. It's the last option that is creating the most problems in the healthcare field.
The most common scenario is surgical groups are bought by health systems looking to gain control of market share on lucrative practice sectors. However, this is a bit more complicated for subspecialists such as spine or neurosurgeons. The spine or neurosurgeons who may join hospitals are often older surgeons who are retiring and don't want to run a new practice, young physicians who don't want to start up their own practice and physicians who don't integrate well within a previous surgical practice. The turn-over rate for employed subspecialists is fairly high with tenure lasting just a couple of years. Hospitals are also now buying practices because they think they can operate them as efficiently as the physicians, but that generally doesn't work well because hospitals are so large. Surgeons at those practices become frustrated with the administrative duties they must perform for the hospital and end up leaving the group.
It's easier for general orthopedic surgeons to work for hospitals because their procedures are relatively routine; so the OR staff knows what is needed and the billing staff can easily capture the right codes. Spine surgeons, on the other hand, set up complicated surgical procedures that often require special imaging and implants. All this complexity makes it difficult for hospitals to provide an arena that meets the surgeons' needs.
There are some advantages to working for a hospital. You already have a guaranteed referral source. New surgeons don't have to go advertising their presence in the community because they have the referral base and marketing capacity from the hospital. However, in hospitals, the motivation for change isn't always quality; it's often dollars. If you are only going to look at dollars, you might be making negative decisions for patient care. In many cases, spine surgeons would become employed by hospitals if they could get what they needed, but they often don't. Additionally, a good spine surgeon can, in general, make significantly more in private practice than hospital employment.
Sanjay Jatana, MD, Spine Surgeon, Jatana Spine, Denver: It will depend on which parts of healthcare reform are and aren't implemented. It will also depend on how reimbursement changes and whether the net income of a practice can stay balanced while reimbursement decreases and overhead costs increase. If it hits the threshold where it is easier to be employed by hospitals, I think you will see a trend toward that. Our group is in the process of working with a hospital to sort out what the hospital would offer us if our group was for sale.
Hospital employment arrangements are either salary-based or RVU-based, and some hospitals haven't figured out the appropriate work RVU for spine surgery. When you figure it for spine, a lot of times you find what they are offering is not equivalent to what you are making in private practice, so it isn't worth it. But if you are going to become employed by a hospital, you should be compensated on an RVU basis so that if you are doing more work you are compensated for it. If there is a month where you are really busy, your income is going to reflect that based on the work RVU for that month.
Samuel Cho, MD, Spine Surgeon, Mount Sinai Medical Center, New York City: Over the next few years, we'll have to sort out whether a private spine practice will be feasible. The reimbursement environment doesn't look like it is going to get better. Right now, people can maintain an independent practice, but I don't know about the future. We as physicians have been interested in tort reform and hopefully future changes in healthcare will address that. If there is an unfavorable medical legal environment, then people are going to practice defensive medicine. In orthopedics and spine, you are already getting some of that, and it drives costs up. As professionals, we need to voice that and hopefully the politicians will listen.
Ira H. Kirschenbaum, MD, Chairman of the Orthopedic Department, Bronx-Lebanon Hospital Center, New York City: In addition to having strong physician leaders and an MBA administrator, the volatile medical market has actually worked to the surgeons' advantage as the hospital has needed physicians' input and buy-in to implement many financial changes and initiatives. Additionally, the hospital has realized that physician choices have an impact on hospital costs and physician alignment with the hospital voluntarily is more important than ever.
Successful spine groups, independent or employed, must hire professional management. The practice should be organized like a business, hiring professional management across the board and holding these managers to agreed-upon metrics. Professional management allows physicians to work with the hospital better.
In his position as chairman of the orthopedic department, Dr. Kirschenbaum participates in the hiring process for spine surgeons.
Richard Guyer, MD, Spine Surgeon, Texas Back Institute, Plano: About 50 percent of the orthopedic surgeons graduating from their specialty training are joining hospitals today. I don't know if that's true for spine because there are many large spine groups around the country that spine surgeons can join instead. With the escalating cost of running a practice and the diminishing reimbursement, it's almost economically prohibitive to maintain a private practice as a solo practitioner — especially with the initiative to implement electronic medical records and increasing governmental regulations. I have had several colleagues join hospitals and they are happy because they don't have to hire and fire employees and they don't have to focus on every little detail of their practice.
I think there is still a big attraction for new surgeons coming out of training to join an established practice. Established practices have become like turnkey operations because when new surgeons join up, they already have a network of primary care physicians and potential patient base in the community. For someone who doesn't want to reinvent the wheel in a metropolitan area, joining a group practice is a good way to go. Established practices have figured out what works and what doesn't, and that is advantageous for new surgeons coming out of their training.
Related Articles on Surgeon Employment:
What Percentage of Orthopedic Surgeons Will Be Employed in 5 Years? 10 Responses
The Future of Orthopedic Surgeon Employment: 3 Core Concepts
10 Biggest Concerns Facing Spine Surgeons From Healthcare Reform
Donald Johnson, MD, Spine Surgeon, Southeastern Spine Institute, Mt. Pleasant, S.C.: Spine surgeons who are focused on research at academic centers have always been employed, but private practice surgeons are now being enticed into employment by hospitals. If the surgeons have a facility that is dependent on a decreasing revenue stream, hospital employment becomes attractive. Every hospital has a primary care referral network, but employing specialists is a rather new situation. Now, a lot of surgeons who have gone into employment are in their third of fourth year in that situation and they are wondering what will happen next. They won't have any leverage when the next contract comes around. They've put themselves in a difficult position because it's hard for them to say they don't want to be employed anymore and return to private practice.
Surgeons who are not directly dependent on hospital-based primary care referrals are able to remain independent from hospital employment because their patients will refer them. We see more patients on referral from other patients than primary care physicians. In a lot of systems, they try to influence the referrals within the system, which is terrible. You want to be sent to the physician that takes care of the problem the best.
Finally, spine surgeons must have ancillary revenue to remain independent. Without the ancillaries, we'd be in the same position as everyone else — looking at hospital employment. Over the past 21 years, we built a practice in a business-minded fashion, and we decided there was no reason why the ancillary services shouldn't be offered here. We didn't do this thinking we'd be in this healthcare environment, but it turned out to be helpful, since we aren't dependent on a hospital.
Fred Sweet, MD, Spine Surgeon, Rockford Spine Center, Rockford, Ill.: Spine surgeons have three options: start their own practice, join an existing group of surgeons or be hired by a hospital. It's the last option that is creating the most problems in the healthcare field.
The most common scenario is surgical groups are bought by health systems looking to gain control of market share on lucrative practice sectors. However, this is a bit more complicated for subspecialists such as spine or neurosurgeons. The spine or neurosurgeons who may join hospitals are often older surgeons who are retiring and don't want to run a new practice, young physicians who don't want to start up their own practice and physicians who don't integrate well within a previous surgical practice. The turn-over rate for employed subspecialists is fairly high with tenure lasting just a couple of years. Hospitals are also now buying practices because they think they can operate them as efficiently as the physicians, but that generally doesn't work well because hospitals are so large. Surgeons at those practices become frustrated with the administrative duties they must perform for the hospital and end up leaving the group.
It's easier for general orthopedic surgeons to work for hospitals because their procedures are relatively routine; so the OR staff knows what is needed and the billing staff can easily capture the right codes. Spine surgeons, on the other hand, set up complicated surgical procedures that often require special imaging and implants. All this complexity makes it difficult for hospitals to provide an arena that meets the surgeons' needs.
There are some advantages to working for a hospital. You already have a guaranteed referral source. New surgeons don't have to go advertising their presence in the community because they have the referral base and marketing capacity from the hospital. However, in hospitals, the motivation for change isn't always quality; it's often dollars. If you are only going to look at dollars, you might be making negative decisions for patient care. In many cases, spine surgeons would become employed by hospitals if they could get what they needed, but they often don't. Additionally, a good spine surgeon can, in general, make significantly more in private practice than hospital employment.
Sanjay Jatana, MD, Spine Surgeon, Jatana Spine, Denver: It will depend on which parts of healthcare reform are and aren't implemented. It will also depend on how reimbursement changes and whether the net income of a practice can stay balanced while reimbursement decreases and overhead costs increase. If it hits the threshold where it is easier to be employed by hospitals, I think you will see a trend toward that. Our group is in the process of working with a hospital to sort out what the hospital would offer us if our group was for sale.
Hospital employment arrangements are either salary-based or RVU-based, and some hospitals haven't figured out the appropriate work RVU for spine surgery. When you figure it for spine, a lot of times you find what they are offering is not equivalent to what you are making in private practice, so it isn't worth it. But if you are going to become employed by a hospital, you should be compensated on an RVU basis so that if you are doing more work you are compensated for it. If there is a month where you are really busy, your income is going to reflect that based on the work RVU for that month.
Samuel Cho, MD, Spine Surgeon, Mount Sinai Medical Center, New York City: Over the next few years, we'll have to sort out whether a private spine practice will be feasible. The reimbursement environment doesn't look like it is going to get better. Right now, people can maintain an independent practice, but I don't know about the future. We as physicians have been interested in tort reform and hopefully future changes in healthcare will address that. If there is an unfavorable medical legal environment, then people are going to practice defensive medicine. In orthopedics and spine, you are already getting some of that, and it drives costs up. As professionals, we need to voice that and hopefully the politicians will listen.
Ira H. Kirschenbaum, MD, Chairman of the Orthopedic Department, Bronx-Lebanon Hospital Center, New York City: In addition to having strong physician leaders and an MBA administrator, the volatile medical market has actually worked to the surgeons' advantage as the hospital has needed physicians' input and buy-in to implement many financial changes and initiatives. Additionally, the hospital has realized that physician choices have an impact on hospital costs and physician alignment with the hospital voluntarily is more important than ever.
Successful spine groups, independent or employed, must hire professional management. The practice should be organized like a business, hiring professional management across the board and holding these managers to agreed-upon metrics. Professional management allows physicians to work with the hospital better.
In his position as chairman of the orthopedic department, Dr. Kirschenbaum participates in the hiring process for spine surgeons.
Richard Guyer, MD, Spine Surgeon, Texas Back Institute, Plano: About 50 percent of the orthopedic surgeons graduating from their specialty training are joining hospitals today. I don't know if that's true for spine because there are many large spine groups around the country that spine surgeons can join instead. With the escalating cost of running a practice and the diminishing reimbursement, it's almost economically prohibitive to maintain a private practice as a solo practitioner — especially with the initiative to implement electronic medical records and increasing governmental regulations. I have had several colleagues join hospitals and they are happy because they don't have to hire and fire employees and they don't have to focus on every little detail of their practice.
I think there is still a big attraction for new surgeons coming out of training to join an established practice. Established practices have become like turnkey operations because when new surgeons join up, they already have a network of primary care physicians and potential patient base in the community. For someone who doesn't want to reinvent the wheel in a metropolitan area, joining a group practice is a good way to go. Established practices have figured out what works and what doesn't, and that is advantageous for new surgeons coming out of their training.
Related Articles on Surgeon Employment:
What Percentage of Orthopedic Surgeons Will Be Employed in 5 Years? 10 Responses
The Future of Orthopedic Surgeon Employment: 3 Core Concepts
10 Biggest Concerns Facing Spine Surgeons From Healthcare Reform