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| Dear Friend,
Is an MSO right for me? How about a CIN?
There’s an old saying that a person doesn’t really want a drill, they want a hole. I actually think there's yet another level of thinking – why do they want the hole? Perhaps it's to hang
a painting.
The same idea holds true with many healthcare structures, whether it's an MSO (a management services organization), an IPA (and independent practice association), an RBMG (a sort-of cousin to an IPA), a CIN (a clinically integrated network), and so on.
In our metaphor, none of them are the painting on the wall. In fact, they’re not even the hole.
What they are is the drill. They’re tools that describe a method of getting you to the business entity or outcome that you seek to create or achieve. They’re not ends in and of themselves.
On the one hand, you can view this as a mini-lecture on the fact that business structures are tools to achieve your desired ends.
But the real takeaway for you is somewhat different: What’s most important for you is to first decide what it is, on a business level, that you’re trying to achieve.
Forget for the moment (but only for the moment!) about legal structure and compliance and the fact that it's a "fill in the blank" such as an MSO.
Instead, simply concentrate on what it is, bottom line, that you want to achieve.
Then, and only then, should we ask the question of what tool or tools... the specific structure or structures... can be applied to get you there.
Comment or contact me if you’d like to discuss this post. |
| | | Business Life in the Time of Coronavirus Mini-Series
The coronavirus crisis caused a short term economic crisis for many medical groups. Our mini-series shows you the way out. Plus, many of the concepts discussed are applicable during both good times and bad.
[If you haven't already seen them, follow this link to watch our entire series.] |
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Watch Tuesday's video here, or just keep reading below for a revised, more polished transcript:
This morning, I saw an article in The Wall Street Journal about pandemic economics and work life balance.
In particular, they wrote that people's balance was off because they were working from home. In fact, they stated that work was keeping people from having a life.
But that's an entirely fallacious concept. If you like what you do, if you're doing something that energizes you, that empowers you, that gives you a purpose, then that is your life. It's not something separate from your life.
This reminds me that many physicians live by the concept of what I call the "physician expiration date". You know, like some date stamped on the bottom of a can: Good until September 15, 2025. Then, all of a sudden, they are retired.
But yet, what happens to so many people who retire, when they lose that larger purpose, that work that somehow "interfered" (so the WSJ claims!) with life? They no longer have that work and they've lost the purpose for life.
Don't fall into that trap.
It's a trap that not only has an unfortunate payday when that big piece of your life called work is gone, but it's also one that prevents you from taking on new challenges, from expanding your practice, from expanding your business.
Look, even if it were true that you had 12 months to live, would you want to stop doing anything new because your last day is about to come? I maintain that you wouldn't.
Think about that. Think about how that actually intersects with your business strategy, your group's business strategy, or your facility's business strategy.
Take work life balance, turn it on its head, and make it pay off for you.
Comment or contact me if you’d like to discuss this post.
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| | How to Deploy the Secret Sauce of Opportunistic Strategy
Webinar On Demand
They say that COVID-19 has changed the world, creating the "new normal." Many of your colleagues and many hospital administrators are running scared.
Others, leaders like you, know that crisis means opportunity.
Let me provide you with the strategic tools and insights that you need in order to seize opportunities, whether they’re in the context of your current business relationships, the expansion of your business activities, or the creation of new ventures.
You will learn:
•Defense as a defective default: It’s necessary, but not sufficient.
•Exploiting weakness: Drop the guilt and identify opportunity.
•Flat line negotiation is fatal: Understand its myths and limitations.
•Negotiation reality: Learn to identify and deploy on multiple planes to affect the outcome.
•Maneuver: Harness the power of maneuver, both in overall strategy and in specific negotiation strategy.
Others see a crisis and freeze in fear. Learn how to see the opportunities and obtain the tools to increase your odds of obtaining them.
The price to attend is $479. The cost of not attending is astronomical. |
| | | | There’s lots of advice out there suggesting single track “cures” to the cash crunch that many medical groups and facilities are experiencing as a result of the coronavirus economic crisis.
Unfortunately for the victims, many cures are being touted by those with knowledge, even extreme knowledge, about one solution, one recipe. Or, in some cases, simply part of the recipe.
Take for example advice concerning valuation, offered up as the solution to the decline in income in the context of an existing coverage stipend arrangement.
Yes, it’s entirely true that modeling valuation, that is fair market value, is an important element of renegotiating stipend support. But the bigger set of issues includes, but is no means limited to, questions such as should you renegotiate, which of many renegotiation strategies should you adopt, what other alternatives are available, and will the solution to that short-term problem ruin your long-term future, among many others.
As I’ve said before (if you haven’t already watched them, watch Business in the Time of Coronavirus Part 1, Part 2, and Part 3), there are many tools, many solutions, to the financial crisis impacting groups and facilities.
However, they must be considered extremely carefully and put into context, into your particular context, that is.
And, consider that many solutions are simply short term solutions to long term problems, band aids on the entity equivalent of birth defects. They offer only short term relief so don’t confuse them for anything else and don’t ignore the need for further analysis and corrective action.
Beware those with a single recipe. After all, knowing the recipe, even the world’s best recipe, for a tagine doesn’t makes you Moroccan.
Comment or contact me if you’d like to discuss this post. |
| | | Listen to the podcast here, or just keep reading for the transcript.
Hey, have you heard this one?
What do you get when you cross a compliance officer with a whistleblower?
Well, in the case of Sutter Health and Sacramento Cardiovascular Surgeons Medical Group, Inc. (“Sac Cardio”), you get an agreement to pay the United States a total of $46,123,516.36 to resolve allegations tied to reimbursement claims they submitted to the Medicare program.
Laurie Hanvey was employed by Sutter as its compliance officer at Sutter Medical Center, Sacramento. When, as she alleges, Sutter entered into a string of noncompliant financial relationships with Sac Cardio and other medical groups in contravention of her oversight and of Stark and the federal Anti-Kickback Statute (“AKS”), she blew the whistle. That is, she became the relator in a False Claims Act lawsuit.
Of the various claims made, that lawsuit resulted in a $500,000 plus settlement by Sac Cardio and a $30 million plus settlement by Sutter, in regard to their relationship.
The balance of the total settlement consists of an additional $15 million to be paid by Sutter for other self-disclosed compliance improprieties.
According to the press release issued by the U.S. Attorney’s office, those self-disclosed violations resulted from referrals by physicians to whom Sutter facilities “(1) paid compensation under personal services arrangements that exceeded the fair market value of the services provided; (2) leased office space at below-market rates; and (3) paid reimbursements of physician-recruitment expenses that exceeded the actual recruitment expenses at issue. Additionally, several Sutter ambulatory surgical centers double-billed the Medicare program by submitting claims that included radiological services for which Medicare separately paid another entity that had performed those services.”
The allegations brought by Ms. Hanley in regard to Sutter’s relationship with Sac Cardio are particularly instructive for physicians and medical groups.
Among the various allegations were that Sutter "stacked" a series of agreements providing aggregate annual compensation exceeding $1.9 million to Sac Cardio, which amount was commercially unreasonable and grossly in excess of fair market value, all to reward the group for its high-volume referrals. As a result, the complaint claimed that the overall arrangement violated both Stark and the AKS.
Specifically, the elements of the arrangement included:
A series of cardiovascular call coverage agreements paying up to $912,500 annually, an amount that increased drastically over the time period covered by the complaint. The complaint alleges that Sac Cardio received that deal to the exclusion of all other cardiovascular surgeons on staff at the hospital.
A "Physician Assistants Agreement" that obligated Sutter to pay Sac Cardio for four PAs at the rate of $170,000 per FTE, a total of $680,000 per year. As part of the arrangement, Sac Cardio was not to bill for the PAs' services, yet it was alleged that Sac Cardio did in fact bill third party payers, including Medicare.
A series of medical director agreements that paid Sac Cardio up to a total of $318,264 per year. Here are some additional takeaways for you: 1. Just because a large entity, for example, a hospital or a surgery center management company, tells you that a deal’s been vetted by their lawyers and is “legal,” don’t bet on it. Vet it through your own counsel and assess your own risk. As in carpentry, measure (assess) twice, cut (do the deal) once. Or don't do the deal – you get the idea. 2. Whether or not you see a series of financial arrangements as related, in other words, as a total arrangement, whistleblowers and the government will. Make sure that the overall relationship passes muster. That includes the fact that overall compensation is within the range of fair market value. Sticking a wet finger in the air to see which way the valuation wind is blowing does not generate sufficient data to support your defense. 3. And, remember, as one of my early mentors was fond of saying, pigs get fat, hogs get slaughtered. Comment or contact me if you’d like to discuss this post. |
| | | Calibrate Your Compass
Read our exclusive RedPaper to guide you through this evolving situation.
The coronavirus crisis caused a short term economic crisis for many medical groups. Our RedPaper shows you the way out. Plus, many of the concepts discussed are applicable during both good times and bad.
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| | Help Us Help You With Helpful Content
What tailored content would you most like to see during this time? How can we focus on solutions to your most pressing strategic concerns?
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| | | | We all hear, and most of us say, that the pace of change in healthcare is quickening. That means that the pace of required decision-making is increasing, too. Unless, that is, you want to take the “default” route. That’s the one is which you let someone else make the decisions that impact you; you’re just along for the ride. Of course, playing a bit part in scripting your own future isn’t the smart route to stardom. But despite your own best intentions, perhaps it’s your medical group’s governance structure that’s holding you back
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| In fact, it’s very likely that the problem is systemic. The Medical Group Governance Matrix introduces a simple four-quadrant diagnostic tool to help you find out. It then shows you how to use that tool to build your better, more profitable future. Get your free copy here.
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| | | | | | Whenever you're ready, here are 4 ways I can help you and your business:
1. Download a copy of The Success Prescription. My book, The Success Prescription provides you with a framework for thinking about your success. Download a copy of The Success Prescription here.
2. Be a guest on “Wisdom. Applied. Podcast.” Although most of my podcasts involve me addressing an important point for your success, I’m always looking for guests who’d like to be interviewed about their personal and professional achievements and the lessons learned. Email me if you’re interested in participating.
3. Book me to speak to your group or organization. I’ve spoken at dozens of medical group, healthcare organization, university-sponsored, and private events on many topics such as The Impending Death of Hospitals, the strategic use of OIG Advisory Opinions, medical group governance, and succeeding at negotiations. For more information about a custom presentation for you, drop us a line.
4. If You’re Not Yet a Client, Engage Me to Represent You. If you’re interested in increasing your profit and managing your risk of loss, email me to connect directly. |
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