In the Business-Minded Surgeon blog, members of OrthoFounders, a national group of orthopedic entrepreneurs, discuss how orthopedic surgeons can lead efforts to fix the problems in health care that are so palpable and apparent to themselves, but opaque and undervalued by others. Topics include how to maximize return based on business strategy and improved clinical performance, how to navigate the entrepreneurial journey, and how to connect with others who have similar interests.

 

 

BLOG: Society measures the value a surgeon provides in dollars — and you should, too

Why does it irritate joint replacement surgeons when they see a 45-year-old patient in clinic whose chief complaint is 3 days of achy knee pain? It is because they know their time is misallocated. Surgeons know there is a patient in the community who needs a joint replacement, but that patient may wait days or weeks for an appointment because surgeons’ time is repeatedly allocated to clearly nonsurgical patients like the one in front of them.

Are surgeons being selfish? Aren’t all patients’ needs equally valuable? Doesn’t society expect surgeons to allocate their time independently of how much revenue they can produce? To me, these questions fit the “we are here to blindly serve mankind” thought-process, which hinges on the false concept that all episodes of care are equally valuable to society, to patients and to the physicians who participate in these. In this blog, I seek to demonstrate why that mindset is a fallacy and to convince surgeons their moral responsibility is to allocate their time based on data that predict maximal revenue production. This is because the measure of the value that physicians provide is the dollar, and that measure is set by payers and patients.

Let’s consider two examples of public-service industries: policing and firefighting. The underpinning of any public service is the allocation of scarce resources to achieve the maximal benefit. As all metropolitan areas have different needs, each builds the specific capacity that fulfills its mission. Each allocates its resources carefully to ensure that it can respond to any need. Is the SWAT team sent to a report of vandalized property? No. Does a brush fire on a vacant lot trigger a five-alarm response? Again, no. The response committed to each instance of need (and the cost of that response) is deliberately calibrated to the anticipated expense in dollars of the incident itself. That is considered to be good stewardship of resources.

However, we have always refused to apply this same logic in health care. Surgeons cannot provide the same value of care to a patient complaining of 3 days of knee pain as they can to a patient with 3 months of knee pain that has failed conservative management. If we systematically allocate the next available surgeon appointment based on a “first-come, first-served” methodology, rather than on data that could predict the value generated by the appointment, then we are being bad stewards of our time. The result will be a lower delivery of revenue to the practice and total value to society.

Surgeon time and effort are scarce resources we should be obligated to allocate where it is most beneficial. I conclude that our moral obligation is to seek the highest reimbursing encounters at all times because the system has carefully calibrated payment to the amount of good we provide. Episodes of care that generate the most revenue are the ones in which our skills and time are most beneficial to society and patients.

The astute reader will recognize there is another important component to revenue generation — the payer. In my next blog, I will address differential payment based on payer. Why does it exist and should we consider it in our business strategy?

John “Jay” Crawford, MD, is a partner at Knoxville Orthopaedic Clinic and founder of nextDoc Solutions, a software company that builds custom apps for orthopedic surgery practices. His primary interest is helping private-practice orthopedic surgeons discover and implement strategies to ensure robust and sustainable business performance in a consumer-driven health care environment.