focus on quality to encourage those referrals. “We want to see everyone who walks through the door,” says Dr. Crandall. “We need to have sufficient quality providers to meet our need for volume. Our care must be consistent with our patients’ and referring physicians’ quality expectations. We have to be able to take on surgical and non surgical cases, work-related issues, tertiary or simple cases.” Currently, the practice has four spine surgeons ranging in expertise from adult and pediatric scoliosis and other major deformity correction to caring for patients with degenerative and traumatic conditions. Additional medical specialists include a pain management physician, five physician assistants and one research nurse. In the future, Dr. Crandall hopes to add additional pain management specialists, tumor and spinal trauma surgeons to further extend coverage at the practice. “We want to develop niche areas in spine we don’t have covered right now,” says Dr. Crandall. “It’s hard for us to meet the needs we have right now and go after new business considering how busy we already are. However, this is an opportunity for the future and we are thinking about how to take advantage of it.” 2. Develop additional ancillary service lines. Right now, the surgeons at Sonoran Spine Center accept any case almost regardless of the payor, which means accepting Medicare patients. Managed care plans continue to drop their rates, significantly decreasing profitability on those cases. Medicare reimbursement has been in a constant state of flux, with Congress threatening to dramatically decrease payments to physicians. As a result, Dr. Crandall and his partners are exploring ancillary services as a new way to bring revenue into the group. Sonoran Spine Center currently includes an in-house X-ray and physical therapy. “Most practices have an X-ray, but since we do a lot of spinal deformity cases we have a machine that allows us to shoot 18x36 inch long spine films,” Dr. Crandall says. “That’s something that can’t be done at just any outpatient radiology center, so we brought it in-house.” When it was time to bring in physical therapy, Dr. Crandall was initially skeptical of its profitability because overseeing the collection of $10-$20 copays can be onerous; the office staff spend time tracking down these small payments, which may not amount to much value. However, soon after incorporating those services the profitability became clear. “It really has been a good, revenue positive decision to add physical therapy,” he says. “We have tight control on the therapists and how the therapy is delivered. Our communication between the physicians’ and therapists’ offices is fantastic, which makes working together with a patient so much easier.” Now, when Dr. Crandall recommends therapy for the patient, he can call a therapist into the office during the patients’ visit to discuss their treatment plan. This boutique level of care projects a positive image of the practice with highly integrated care. 3. Investment in a surgical hospital. Sonoran Spine Center invests in a surgical hospital dedicated to orthopedic and spine procedures. While the hospital offers a little extra ancillary revenue, Dr. Crandall said the most significant return on the investment comes from patient and physician satisfaction. “We have governance control on the way patients are taken care of and screened at the hospital,” he says. “It’s far more enjoyable from the patient’s experience, as well as the surgeons’ standpoint, to have all the nurses, physical therapists and OR staff all on the same page with one goal: to make patients happy.” Since the staff is focused only on orthopedic and spine cases, they are more familiar with recovery process and can develop a closer relationship with physicians and patients. “For me, it’s such a pleasure to walk on the floor and have the nurses approach me, telling me about a specific patient,” he says. “I can tell the nurse has been closely involved with the patient, and patients feel like we are listening to them. The patient satisfaction surveys we get back at our surgical hospital are sometimes 20-30 percent higher than satisfaction surveys on the same surgeons at different hospitals.” Dr. Crandall says the strict focus on patient care has created a culture in the surgical hospital that promotes higher patient satisfaction and a better physician experience than at typical, non-specialty hospitals. 4. Strike a balanced payor mix. With declining reimbursement rates across the board, spine practices must analyze their payor mix and figure out how to recruit more profitable cases. For Sonoran Spine Center, this means doing an appropriate number of other cases, including workers’ compensation cases, to balance Medicare rates. Workers’ compensation cases pay higher rates than other cases, partially because there is extra work the physicians and specialists must complete for each episode of care. Some practices focus solely on workers’ compensation cases — which is one example of an effective business model, but not one Sonoran Spine Center aspires to achieve. “We don’t want to do entirely workers’ compensation cases, but we do want a good level of workers’ compensation in our payor mix,” says Dr. Crandall. “With that higher reimbursement, we can become more efficient.” 14 Spine However, if Medicare cases continue to decline at an unsustainable rate, spine