Q: Was it an easy decision to join Gould Medical Group?
Kevin Mikaelian, MD: Although we joined Gould on Aug. 1, we had been in negotiations with them for more than two years. It was a difficult decision to leave private practice, especially with a lucrative buy-in of our surgery center on the table. We were in talks with a big investment group to sell the surgery center, which we owned with the other orthopedic group in the area.
We had to decide which option was best for our future, since non-compete clauses made each deal mutually exclusive. In the end, we felt long-term access to patients and the stability of a large group like Gould was more important than a short-term windfall from the surgery center deal. Also, the ASC deal would have had a five-year non-compete clause that would effectively have negated our ability to adapt to changes in the future.
While we would have preferred to remain in an autonomous private practice, future access to patients was a deciding factor. Since several of our main referring physicians in the area had joined Gould, we stood to lose a significant percentage of patients. Although Gould as yet had no orthopedic surgeons in its local network, it was clear that if we did not join, it was going to recruit orthopedic surgeons from outside of the community. In addition, future growth of multi-specialty groups would further decrease access to those patients.
Q: Were reimbursement rates through Gould another deciding factor?
KM: Reimbursement was a major concern for us, because we believe physicians’ fees are likely to fall. The proposed federal health reforms call for savings, and physicians’ reimbursements have always been an easy target to produce savings.
When it comes to negotiating fees with insurers, a small private practice group does not have the leverage that a big group has. Actually, we had been members of a large multi-specialty IPA, Hill Physicians Medical Group [based in San Ramon, Calif.], which used the power of numbers to negotiate favorable rates for us. But Gould is part of an even larger organization, Sutter Health, which was able to negotiate rates that were at least 15 percent better than Hill’s.
Q: I understand Gould will provide you with an electronic medical record, which you did not have as a private practice.
KM: We had been looking into EMR as a private practice because there are some great advantages to having it and, under provisions of the federal stimulus bill, if you don’t have EMR by a certain time, you will have to pay penalties. For us, EMR’s advantages are that it can provide easy access to imaging and other information and decrease the need for office staff. But when we researched prices for installing an EMR, it came out to about $100,000-$150,000 for our group of seven orthopedic surgeons.
We are now in the process of setting up EMR with Gould. We already use their PACS system for imaging and have read-only capability of existing medical records in the Gould system, which we can consult when a Gould patient is referred to us. Our own charts are currently on paper, but we are in the process of scanning all of them into the Gould EMR system. This should be completed by December, and then we will be fully up-and-running.
Q: Are there any other benefits you would like to mention?
KM: The support structure of Gould has been hugely beneficial to us. Sutter Gould Medical Foundation [Gould’s parent organization] has taken over all our office operations, so we no longer have to deal with the extra work and the stress of payroll and staffing issues. That gives us more time to focus on taking care of patients. One specific advantage of the relationship is access to Gould’s “float pools” of staff who can be called into our offices when they are needed. In private practice, you don’t have the resources to do that.
But despite Gould’s new support role, we were able to bring over most of our support staff from the private practice, about 25 employees, which made the transition fairly seamless. We are still in the same offices as before, but in December we’ll move into a new surgery specialty building on the Gould campus, which offers a full array of medical services that will be more convenient and efficient for our patients.
Q: Do you miss the autonomy of a private practice?
KM: Losing autonomy has been the biggest change. As a private practice, we had the ability to manage our own staff and to change the business plan when we desired. We still have some autonomy to decide what we want to do at Gould, but our plans have to be approved by the Gould board. For example, we began searching for a physician assistant as a private practice and now we would like to complete that search, but first we have to make our case to Gould as to why the position is necessary.
Q: Has the move affected your referral base?
KM: Yes. As part of Gould, we will no longer be able to take referrals from physicians who are part of Hill or Medcore Medical Group. These referrals accounted for approximately 18 percent of our practice. When we informed the Hill and Medcore patients of the change, many them indicated that they wanted to stay with us. We let them know which local primary care physicians were in our new network and many of them switched primary care physicians in order to stay with us. That is a mark of our deep ties with our community. Our practice has been here for nearly 40 years. Meanwhile, we are also seeing a lot of new patients referred by Gould doctors, both from within the local community and from surrounding communities.
