Editor's note: This is the second in a two-part series on the emerging market opportunity in musculoskeletal services. Last week's article focused on the factors driving the developing market. This week's article discusses how to prepare for key trends in the market and develop a program that will contribute to your bottom line.
Today, more than one-third (37 percent) of the U.S. population is 45 years of age or older. In a little more than 10 years that percentage is projected to increase from 37 percent to 42 percent, and account for more than 118 million people. By 2017, the leading edge of the baby boom will be entering their early 70's. This generation will seek healthcare services that promote good health and longevity, as well as support an active lifestyle. Chief among their needs will be musculoskeletal and orthopedic services.
Combine an aging population with technological advances in orthopedic care and devices, and the stage is set for unprecedented demand and increased opportunities for healthcare providers.
Key trends to watch There are five key trends that hospitals and health systems need to aggressively plan for:
Consumerism: Patients are increasingly taking charge of their healthcare. Our musculoskeletal health research shows that, lacking comprehensive information from their primary care physicians, consumers are developing their own continuums of care to maintain health and vitality. Services in their continuums include physical and occupational therapy, exercise and weight reduction, aqua therapy, chiropractic, yoga, integrative medicine and acupuncture. Consumers are willing to invest time and money to educate themselves about treatment options and create a personalized care pathway that will enable them to reduce pain and maintain an active lifestyle.
Physician specialization: The percentage of sub specialty (fellowship) trained orthopedic physicians has increased from 20 percent in 1990 to almost 40 percent in 2005. Increasingly, orthopedic physicians are specializing in sports medicine, hand, spine and joint replacement. Our research confirms that consumers seek fellowship trained, high volume surgeons when considering surgery. To be considered the preferred provider of care musculoskeletal centers will require a cadre of these specialists.
Rapidly changing technology: Two inpatient areas undergoing significant changes are spine and total joint surgery. In spine surgery, interspinous spacers, dynamic stabilization systems, facet arthroplasty and minimally invasive fusion techniques loom on the horizon. Total joint replacement surgery faces competition from new techniques and new modes of delivery including resurfacing arthroplasty, minimally invasive surgery, computer-assisted surgery, increasingly differentiated joint implants and the movement to outpatient surgical centers. In most cases technological improvements come with increased costs placing increased pressure on procedure margins. With direct to consumer advertising by implant and technology vendors, consumers are seeking the latest implants and equipment.
Market structure and competition: In some markets, hospitals are losing volume to specialty hospitals and ambulatory surgical centers. It is estimated that there are approximately 30 hospitals in the U.S. that specialize in orthopedics. Physician offices are also capturing market share through the development of focused ambulatory surgical centers, the acquisition of imaging equipment-CT and MRI's, therapeutic equipment, and the provision of outpatient rehabilitation. A by-product of this increased competition is that as patients are treated in ASCs and physician offices, the acuity of hospital patients increases.
Quality and cost transparency: CMS and The Joint Commission have targeted the next round of quality measurement on orthopedic procedures. Public reporting of basic measures of volume, length of stay, infection rates, return to surgery, pain management, patient satisfaction and DVT/PE events will evolve to range of motion (pre and post), percent discharged to home, time required for return to work or quality of life, unrestricted activity, and years between implant procedures. The focus of costs will be on the total cost of care between pre-surgery and return to work or quality of life.
These five trends demand that musculoskeletal services be designed and implemented to meet the multifaceted needs of an increasingly savvy consumer, but also for physicians and hospitals facing limited increases in procedure payments.
Creating a musculoskeletal medicine program Implementing a Musculoskeletal Medicine Program or Service Line can create significant bottom-line results. It can equip and position your hospital or health system to:
Provide a service that creates a tangible, positive difference in patients' lives
Increase your top line revenue and net operating income
Increase your case mix index
Increase volume and revenue to your onsite and off-site ancillary services (PT, OT, Lab)
Develop alignment opportunities with your medical staff
Develop partnerships with other community agencies (VNA, DME)
Improve the esprit de corps of the service line clinical staff, and help reduce employee turnover
It is important to acknowledge that musculoskeletal medicine is more than orthopedic surgery. Today's older adult and baby boomers are interested in exploring all options prior to pursuing surgery. Customer-centric, comprehensive musculoskeletal centers will need to offer the following spectrum of services including:
Prevention and Health Promotion: Outreach, Educational Program, Online Information, Weight loss and fitness information
Diagnosis: Primary Care, Radiology, Laboratory
Treatment: Rheumatology, Physiatry, Rx Consultation, PT and OT, Pain Management, Weight Loss, Complementary Medicine, Care Management, Surgery
Rehabilitation: Inpatient PT/OT, Home PT, Outpatient PT/OT, Fitness Programs
Habilitation: durable medical equipment
Strategies for success Hospitals and health systems seeking competitive advantage with a musculoskeletal medicine service line must implement an integrated process of care to facilitate patients' diagnosis, intervention, recovery and wellness.
Implementing key strategies can establish a long-term platform for growth and profitability of your Musculoskeletal Medicine program:
Identifying and assigning responsibility to a service line leader and physician champion
Focusing on those areas where the institution and the medical staff are strong
Providing comprehensive and integrated patient-focused care to manage the entire course of care from beginning to end
Proactively managing all costs, especially implant costs, and capital expenditures for new technology
Streamlining all consumer and physician office staff interactions/processes with the hospital
Aggressively marketing the program to both referring physicians and consumers
Publishing clinical results
It is the masterful, thorough execution of the entire process from health promotion through clinical intervention by the hospital, physicians and ancillary clinical staff that will drive volume and market share. In these days of continuous revenue and margin challenges, musculoskeletal medicine can be--for those institutions with the will, fortitude and quality medical staff--the next big growth opportunity.
John Kessler is vice president of The Strategy Group in Norfolk, VA. He is a consultant, speaker and author. He may be reached at kessler@thestrategygroup.com.
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Kathy Lapacek, vice president of business development for Advocate Good Shepherd Hospital, describes the organization's "Red Shirt" campaign, a winner at the 2007 HealthLeaders Media Marketing Awards. Lapacek will talk about the planning and strategy that went into this successful campaign during the March 19 Webcast, Marketing Cardiology: Strategies for service line campaigns.
The most serious domestic policy problem this country faces is the rising costs of Medicare, says John C. Goodman, president of the National Center for Policy Analysis. In this Wall Street Journal opinion piece, Goodman presents his ideas on how to control the problem.
I am down in Orlando this week, covering the massive HIMSS exhibition. Next week I will have a compilation of some of the top presentations I heard. Meanwhile, I wanted to share some of the correspondence I have received lately. The reactions to my piece, "Are IT Vendors Losing Their Marbles," are especially appropriate during HIMSS week, seeing as how the event showcases the wares of hundreds of companies trying to squeeze into this complex, crowded space.
First is a letter from Michael Davis, a member of HIMSS Analytics, which sponsored the survey I referenced.
Skeptical CIOs I enjoyed your article--"Are IT Vendors Losing Their Marbles." In most cases the healthcare IT professionals are looking for peer-to-peer interactions without vendor influence or facilitation. This is difficult for vendors to achieve. I do believe the vendors today are performing better in delivering competitive products and providing enhanced customer service, but healthcare IT professionals have been burned too many times with incomplete or overhyped vendor solutions. Thus, they will continue to be skeptical.
I enjoy reading your take on the market. Keep them coming.
Michael W. Davis Executive Vice President HIMSS Analytics Chicago, IL
'Crazy Like a Fox' I think this article ("Are IT Vendors Losing Their Marbles?") hits the nail on the head. CIOs waste so much of their (and their staff's) time cutting through the hype and trying to get straight answers that it places an enormous unnecessary cost on the process of selecting and implementing meaningful solutions. That being said, there's another side that's even worse--the great marketer HIT vendor that can't deliver. A select few HIT vendors have learned, even mastered, the art of creating the need at the board, executive, and/or physician level, and bypassing the CIO--who knows better.
These vendors paint a wonderful picture of a future state that only they can get the organization to. The people they court have no idea of how to evaluate much less challenge their claims. They make it look so easy too! The CIO is left to stand in front of this rushing train or risk trying to implement tremendously complex systems to unreasonable expectations set by the vendor. If (or more likely when) the project fails, the vendor conveniently lays the blame at the feet of the CIO, since it "has been successfully implemented at many other sites." The light at the end of the tunnel is that over time, a realization sets in that there was insufficient scrutiny of vendor claims and lack of due diligence by organizational leadership.
The bad part is that the CIO is usually left to sort it out and move things forward regardless. That's why it is vital that CIOs educate their executives early and often on the state of our industry and the HIT solutions available so they can set realistic expectations as an organization.
I guess the answer to your article title is 'yes' but that some vendors are 'crazy like a fox!'
Vincent S. Vitali, FHIMSS Interim CIO Navin, Haffty & Associates BroMenn Healthcare Normal, IL
Providers Not Paid to Cure You have hit on an interesting fact in healthcare that is generally underappreciated. ("Which Came First, the MRI or the Inflation?") Technology tends to raise the cost of care, not lower it (as it would in any other industry). Is healthcare fundamentally odd?
No. If providers got paid to cure something, then technology would lower the cost of care for any given outcome. But providers don't get paid to cure anything. They get paid to do something. If that something requires a piece of technology, and the technology item (a procedure, for example) has a bill code, then they do MORE of the item since they get paid for it.
In 1975 there were almost no gastroenterologists. Then we developed a number of increasingly complicated fiber optic scopes, and procedures related to them, each of which has a bill code for it. Each successive device is more expensive, and the associated bill code is higher. Now gastroenterology is one of the largest subspecialties, and the cost of GI treatment has skyrocketed, although outcomes have indeed improved.
Over the same time period, Lasik surgery has decreased in cost as outcomes rose. Lasik is not covered by insurance, hence docs get paid to deliver an outcome (to a consumer), not to perform a procedure (lasik results are often "guaranteed" to consumers).
Tim Breaux Principal InterCase Portland, OR
Live From HIMSS 2008
Senior Editor Gary Baldwin is reporting daily dispatches live from the annual HIMSS conference. Here are some of the stories he has published so far:
Vanderbilt University Medical Center Department of Anesthesiology was among the organizations recognized in a contest sponsored by Microsoft. Vanderbilt claimed top honors in the inpatient record category. Its vendor partner is Acuitec, which helped the Nashville-based organization build a consolidated view of patient data.
The Microsoft Healthcare Users Group (MS-HUG) announced the winners of the 11th annual MS-HUG Healthcare Innovation Awards 2008 at HIMSS. The contest recognizes organizations working with various vendors on the Microsoft platform.
Other winners included:
Primrose OB-GYN, with digiChart Inc., for its physician practice record
Sunnybrook Health Sciences Centre, with Neoteric Technology Ltd., for system upholding the safety of breast milk
St. Joseph Family Medicine Residency (Medical College of Wisconsin), with NextGen, for innovative use of an electronic medical record
Office of the Air Force Surgeon General, Data Modeling and Analysis Office, with IMS Government Solutions, for outcomes reporting technology
Note: HealthLeaders Media Technology Editor Gary Baldwin helped judge the contest.
The planned two-hospital management deal between Metrocrest Hospital Authority and Hospital Partners of America has been dissolved. Charlotte, NC-based Hospital Partners had been negotiating to take over management of Trinity Medical Center in Carrollton, TX, and RHD Memorial Medical Center in Farmers Branch, TX, since 2006. The negotiations were halted due to "outstanding financial issues," said Metrocrest representatives.
Both Rex Healthcare and WakeMed Health & Hospitals are plotting big growth plans in Raleigh, NC. Rex Healthcare is planning a $150 million outpatient facility across from its main campus in West Raleigh, NC. At the same time, WakeMed Health & Hospitals is moving forward with plans to build a $99 million inpatient facility at its main campus in East Raleigh. Both projects come as the hospitals develop strategies to manage services while their facilities become strapped for space as the area's growing population demands more healthcare.
Seattle's Group Health Cooperative has told 363 hospital employees they will be laid off as the nonprofit system's begins the closure of its Hospital & Specialty Center. The precise number of people who will be out of work is hard to determine, because some of the affected workers may be hired to fill openings at its outpatient facilities, or at the expanded Overlake Hospital Medical Center, said Group Health representatives.
In the 1980s and 1990s U.S. medical schools put a cap on enrollments, believing that managed healthcare, among other factors, would create a glut of doctors. Now the impact of a national shortage of surgeons and family practice doctors is echoing across the country. The shortage of surgeons is a particular threat to the healthcare of 54 million rural Americans, medical specialists say.
Nasvhille, TN-based Skyline Medical Center is planning a $3.2 million expansion that will double the number of beds in its neurological intensive care unit to accommodate growing demand for treatment for strokes and other neuroscience services. The project is scheduled for completion by the end of 2008.
